President Trump is likely to announce more exemptions from his new tariffs on Canadian and Mexican products, Commerce Secretary Howard Lutnick said Thursday.
In an interview with CNBC, Lutnick said Trump is likely to exempt Canadian and Mexican goods and services from tariffs that comply with the U.S.-Mexico-Canada Agreement (USMCA), the North American Free Trade Agreement (NAFTA) renegotiation cemented during his first term.
The exemption, Lutnick said, would last only for one month.
“It’s likely that it will cover all USMCA compliant goods and services, so that which is part of President Trump’s deal with Canada and Mexico are likely to get an exemption from these tariffs,” Lutnick told CNBC.
Lutnick’s announcement follows Trump’s decision Wednesday to exempt USMCA-compliant North American automakers from the new tariffs. The president did so after speaking with the heads of the “Big Three” U.S. auto companies — General Motors, Ford and Stellantis, all of which operate plants throughout Canada, Mexico and the U.S.
Despite promising to impose strict, broad-based tariffs on his first day in office, Trump has rolled out his trade agenda in fits and starts. The president delayed the effective date of his new Canada and Mexico tariffs twice before letting them effect Monday, and has floated several exemptions and delays throughout the week.
Markets and business leaders have struggled to make sense of Trump’s trade plans amid the confusion and conflicting messages from administration leaders.
Vice President Vance suggested Wednesday that Trump would not issue any more exemptions from tariffs, touting the president’s desire for broad-based import taxes.
“The way to avoid application of the tariffs is to have your factory and have your facility in the United States of America. That is the way, invest in America, that is how you will avoid being penalized by these tariffs,” Vance added.
Stocks have whipsawed throughout the week as Wall Street tracks the latest back and forth among the U.S. and its top two trading partners.
All three major stock indexes opened Thursday with losses of more than 1 percent after a brief Wednesday rebound.
Lutnick insisted that the performance of the market, which is notoriously important to Trump, was not driving administration trade policy.
“The president wants American growth and American prosperity, okay? And the fact that the stock market goes down half a percent or percent, it goes up half a percent or percent, that is not the driving force of our outcomes,” Lutnick said
“The president is focused on rebuilding America, and you are going to see growth in America… You’re going to see interest rates drop 1% or more. You’re going to see the stock market explode.”
