'Shocked gasps' at Donald Trump's new threat

He said not doing things his way could led to penalties of “trillions of dollars” of tariffs imposed that would benefit US coffers. 

Mr Trump gave a speech and took questions via video link from Washington at the World Economic Forum (WEF)’s annual conference in Davos, Switzerland. 

the Web pow wow has attracted business and political leaders from across the globe and even a few celebrities with ex England footballer Davos Beckham turning up.

His stump speech including familiar themes such as strengthening the US border with Mexico, ending the war in Ukraine and exploiting more of the US’ energy resources. 

But he also warned that countries which didn’t invest in America would face tariffs. 

And he once again brought up Canada becoming a state of the US.

“My message to every business in the world is very simple, come make your product in America, and we will give you among the lowest taxes of any nation on Earth,” Mr Trump said.

“But if you don’t make your product in America, which is your prerogative, then very simply, you will have to pay a tariff — differing amounts, but a tariff – which will direct hundreds of billions of dollars even trillions of dollars into our Treasury to strengthen our economy and pay down debt,” Mr Trump told the Davos meeting. 

“Under the Trump administration, there will be no better place on earth to create jobs, build factories or grow a company than right here in the good old USA.”

Tariffs are not paid for by the nations that export goods – they are paid for by importer sin the country imposing the tariff. Which in this case would be American firms and likely – in the end – consumers.

He has floated 10 per cent tariffs on China and 25 per cent on Canada and Mexico. 

However, Mr Trump has not signed any executive orders regarding tariffs despite the flurry of other pronouncements. 

There is said to be mixed feelings in the Trump administration with some cautioning President Trump that high tariffs could ease to higher process and further inflation. 

At the meeting, Mr Trump took aim at Canada once again claiming the US simply didn’t need many of the country’s exports. 

‘Shocked gasps’

He has repeatedly pointed out the US has a trade deficit with Canada.

“We have tremendous deficit with Canada. We’re not going to have that anymore.” He said. 

“Canada has been very tough to deal with. 

“(But) we don’t need them to make cars, we don’t need their lumber because we have our own forests, we don’t need their oil and gas because we have more than anybody”.

But Mr Trump did have a solution that could see Canada maintain its current economic settings with the US.

“I said to them, you can always become a state, and if you’re a state we can have a deficit and we won’t have to tariff you”.

The BBC reported there were “shocked gasps” in the hall when Mr Trump again mentioned Canada becoming a state p- a prospect that has been roundly rejected by the Canadian government and is deeply unpopular with Canadians. 

Wide ranging tariffs across nations could spark tit-for-tat trade wars with countries also putting tariffs on US imports. 

Australia’s economy would undoubtedly be harmed by tariffs. However, unlike many nations in Mr Trump’s sights, the US exports more to Australia than it imports. 

Mr Trump said he hoped China and the US could gave a “very good relationship”.

“All we want is fairness. We just want a level playing field. We don’t want to take advantage.

“The deficit (with China) is massive, as it is with other countries … and we can’t keep doing that, so we’re not going to keep doing that. 

“But I like President Xi very much. I’ve always liked him. Covid – coming out of Wuhan – obviously strained it,” he said. 

“I’m sure it strained it with a lot of people (but) always had a great relationship”.