In an important development impacting trade relations within North America, the White House announced today that effective 12:01 a.m. EST on March 7, 2025, the recently imposed International Emergency Economic Powers Act (IEEPA)-based tariffs on goods from Canada and Mexico will be temporarily suspended for all products compliant with USMCA origin requirements. This temporary suspension will remain in effect until April 2, 2025, the date when reciprocal tariffs, previously indicated by former President Trump, are scheduled to commence.

Initially imposed on March 4, 2025, these tariffs included a 25% duty on Canadian- and Mexican-origin goods, with a reduced 10% rate specifically applied to Canadian-origin energy products. This latest decision broadens the scope of tariff suspensions beyond yesterday’s limited announcement concerning USMCA-compliant automobiles.

Additionally, the White House announced a tariff rate reduction from 25% down to 10% on imports of potash from Canada and Mexico that do not meet USMCA origin criteria.

In response to these developments, Mexico’s President Claudia Sheinbaum has stated that Mexico will not proceed with the previously scheduled retaliatory tariffs against U.S.-origin products, initially planned for implementation on March 9. Canada, however, has not reciprocated the suspension of tariffs and continues to enforce retaliatory measures effective as of March 7.

It is important to note that separate tariff adjustments concerning Chinese and Hong Kong-origin products, specifically the increase from 10% to 20% initiated on March 4, remain unaffected and will continue as planned. China’s retaliatory tariffs against U.S.-origin products will similarly persist without changes.

Businesses operating within North America are advised to monitor ongoing developments closely, particularly regarding compliance with USMCA rules of origin, to fully leverage this temporary suspension period and prepare for potential reciprocal tariffs starting April 2.