The U.S. government has stated that Canada and Mexico could still avoid hefty tariffs if they take action to curb fentanyl trafficking at their borders while also committing to slowing China’s advancements in artificial intelligence.

Trump has said he is considering imposing 25% tariffs on both countries by 1 February. He has previously tied the tariffs threat to ending illegal migration and drugs crossing into the US through its southern and northern borders.

President Donald Trump's commerce secretary nominee Howard Lutnick said at his U.S. Senate confirmation hearing on Wednesday (January 29) that Canada and Mexico can avoid looming tariffs if they act swiftly stop the flow of fentanyl into the U.