WASHINGTON -- President Donald Trump on Monday agreed to a 30-day pause on his tariff threats against Mexico and Canada as America's two largest trading partners detailed steps to appease his concerns about border security and drug trafficking.
The pauses provide a cool-down period after a tumultuous few days that put North America on the cusp of a trade war that could have crushed economic growth, caused prices to soar and soured two of the United States' most critical partnerships.
"I am very pleased with this initial outcome, and the Tariffs announced on Saturday will be paused for a 30 day period to see whether or not a final Economic deal with Canada can be structured," Trump posted on social media. "FAIRNESS FOR ALL!"
Canadian Prime Minister Justin Trudeau posted Monday afternoon on social media platform X that the pause would occur "while we work together," saying that his government would name a fentanyl czar, list Mexican cartels as terrorist groups and start a "Canada-U.S. Joint Strike Force to combat organized crime, fentanyl and money laundering."
The pause followed a similar move with Mexico that allows for a period of negotiations over drug smuggling and illegal immigration.
The 10% tariff that Trump ordered on China is still set to take effect as scheduled on Tuesday, though Trump planned to talk with Chinese President Xi Jinping in the next few days.
Sen. Mitch McConnell, R-Ky., criticized Trump's threats to tax imports, warning that the move would raise costs on a wide range of imported goods.
"It will drive the cost of everything up," McConnell said during an interview with Lesley Stahl on CBS' "60 Minutes," which aired Sunday. "In other words, it will be paid for by American consumers. I mean, why would you want to get in a fight with your allies over this?"
While the trade war feared by investors, companies and political leaders now seems less likely to erupt, that doesn't mean the drama over Trump's tariff threats has ended.
Canada and Mexico bought some additional time, but Trump could easily renew his tariffs and already plans to announce taxes on imports from the European Union.
All of that leaves the global economy uncertain about whether a crisis has been averted or if a possible catastrophe could still be coming in the weeks ahead.
Trump on Saturday had directed 25% tariffs on imports from Mexico and Canada, with another 10% tariff on Canadian oil, natural gas and electricity.
The U.S. president had repeatedly previewed these moves, yet they still managed to shock many investors, lawmakers, businesses and consumers.
Multiple analyses by the Tax Foundation, the Tax Policy Center and the Peterson Institute for International Economics showed that the tariffs could hurt growth, lower incomes and push up prices.
But Trump repeatedly insisted -- despite promises to curb inflation -- that tariffs were necessary tools to get other nations to stop illegal immigration, prevent fentanyl smuggling and treat the United States, in his mind, with respect.
Trump and Mexican President Claudia Sheinbaum announced the monthlong pause on increased tariffs against one another after what Trump described on social media as a "very friendly conversation," and he said he looked forward to the upcoming talks.
"I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a 'deal' between our two Countries," the president said on social media.
Trump said the talks would be headed by Secretary of State Marco Rubio, Treasury Secretary Scott Bessent, Secretary of Commerce nominee Howard Lutnick and high-level representatives of Mexico.
Sheinbaum said she was reinforcing the border with 10,000 members of her country's National Guard and that the U.S. government would commit "to work to stop the trafficking of high-powered weapons to Mexico."
In 2019, when Mexico's government also avoided tariffs from Trump's administration, the government announced it would send 15,000 soldiers to its northern border.
But for much of Monday, the outlook was worrisomely different for Canada, only for an agreement to come together.
A senior Canadian official said Canada was not confident it could avoid the looming tariffs as Mexico did.
That's because Canada feels as if the Trump administration has been shifting its requests of Canada more than it did for Mexico.
The official spoke on condition of anonymity, having not been authorized to speak publicly.
Asked Monday afternoon what Canada could offer in talks to prevent tariffs, Trump told reporters gathered in the Oval Office: "I don't know." He mused about trying to make Canada the 51st state, part of ongoing antagonism despite decades of friendship with Canada.
The U.S. president also indicated that more import taxes could be coming against China: "If we can't make a deal with China, then the tariffs will be very, very substantial."
White House press secretary Karoline Leavitt told reporters that Trump would speak with Chinese President Xi Jinping in the next couple of days and that the White House would provide a report on the discussion.
Industry representatives and spokesmen in Arkansas were still trying to prepare Monday for the possibility of higher tariffs on imports. Some products, like car parts, may cross the border multiple times before a vehicle is completed, and that could drive auto prices much higher, analysts predicted.
In an interview Monday, Greg Kirkpatrick, president of the Arkansas Automobile Dealers Association, said dealerships typically have 60 to 75 days of supply so if tariffs ever kick in, consumers would not see an immediate price increase.
He said since there were so may factors involving how exactly tariffs would affect the costs of parts and vehicles, it would be anyone's guess how much prices could or would go up.
Already inflated grocery prices, one of the issues Trump campaigned on, would continue to rise in a trade war, analysts said.
All Arkansas grocers would be affected by the proposed tariffs, said Steve Goode, executive director of the Arkansas Grocers and Retail Merchants Association.
It's not just the higher prices on produce from Mexico that will hurt, Goode said.
"We get fuel from Canada, and fuel affects everything in the supply chain," he said.
"We don't even know if this will happen," Goode said, "but we have costs, and consumers will bear the brunt of it."
Donnie King, Tyson Foods Inc. president and chief executive officer, said the poultry company is continuously developing contingency plans to ensure it can monitor and respond to new policies.
"As we have done in the past, we will leverage our global expertise to identity the best market for our product amid evolving conditions," King said.
King said the company has been preparing for tariffs and believes they have risks adjusted in the company's guidance for the upcoming year.
Trucking industry officials have concerns possible tariffs could decrease freight volumes as the industry continues to recover from a years-long freight recession.
Chris Spear, American Trucking Associations president and chief executive officer, said in a statement that a tariffs levied on Mexico imports could drive up the price of a new truck tractor by $35,000.
"That is cost-prohibitive for many small carriers, and for larger fleets, it would add tens of millions of dollars in annual operating costs," he said.
Spear said trucks move 85% of goods across the southern border and 67% of goods that cross the northern border, and support hundreds of thousands of jobs in the United States.
"We firmly support policies that will secure our borders and protect legitimate trade, but we also recognize the unintended consequences that substantial tariffs could have over the long-term, including higher consumer costs on the wide range of goods that cross our borders by truck, including food, automobiles, televisions, computers, furniture and other key manufacturing inputs," he said.
Information for this article was contributed by Josh Boak, Rob Gillies, Fabiola Sanchez and Anne D'Innocenzio of The Associated Press; John Magsam, Dylan Sherman, Lucas Dufalla and Serenah McKay of The Arkansas Democrat-Gazette; and by The Washington Post.
A truck pulls newly assembled truck cabs across the border bridge, from Mexico into the United States, from Mexicali, Mexico, Monday, Feb. 3, 2025. (AP Photo/Fernando Llano)
Canada's Prime Minister Justin Trudeau addresses media following the imposition of a raft of tariffs by U.S. President Donald Trump against Canada, Mexico and China, in Ottawa, Saturday, Feb. 1, 2025. (Justin Tang/The Canadian Press via AP)
President Donald Trump speaks to reporters next to Air Force One after arriving back at Joint Base Andrews, Md., Sunday, Feb. 2, 2025. (AP Photo/Ben Curtis)
A private security officer with a sniffer dog inspects a truck loaded with sweet corn destined for the United States at the border in Mexicali, Mexico, Monday, Feb. 3, 2025. (AP Photo/Fernando Llano)
Trucks enter into the United States from Ontario, Canada across the Ambassador Bridge, Monday, Feb. 3, 2025, in Detroit. (AP Photo/Paul Sancya)
Lights illuminate the prime minister's office in the Office of the Prime Minister and Privy Council in the Parliamentary precinct, Monday, Feb. 3, 2025 in Ottawa. (Adrian Wyld/The Canadian Press via AP)
The flags of Mexico, Canada and the United States are shown near the Ambassador Bridge, Monday, Feb. 3, 2025, in Detroit. (AP Photo/Paul Sancya)
Shipping containers are seen at the Atlantic Hub container terminal in Halifax on Monday, Feb. 3, 2025, one day ahead of imposed tariffs by U.S. President Donald Trump against Canada. (Darren Calabrese/The Canadian Press via AP)
The U.S. Border with Mexico is seen in an aerial view Friday, Jan. 31, 2025, near San Diego. (AP Photo/Jae C. Hong)