Trump Opens Tariff War Over Drug 'Fentanyl' [AK Radio]

Countries Along the Fentanyl Supply Route Face Pressure
Tariff Suspension Is Temporary... South Korea Must Prepare

After U.S. President Donald Trump threatened to impose additional tariffs of 25% on Canada and Mexico and 10% on China, he announced a one-month grace period. He then cited the drug 'fentanyl,' smuggled into the U.S. through the borders of Canada and Mexico via China, as the justification for targeting these three countries as the first victims of the tariff war. As a result, not only China, which has been in conflict over fentanyl, but also Canada and Mexico, located along the fentanyl distribution routes, have come under fire in the tariff war, increasing volatility amid concerns over a contraction in global trade. Traditional U.S. allies, including South Korea, are now also at risk of entering a tariff war with the U.S. at any time, prompting swift preparations by various countries.

On the 3rd (local time), President Trump announced a sudden one-month suspension of the full 25% tariffs on Canada and Mexico, which were set to take effect the next day. He also stated that he would negotiate with the Chinese government, which was scheduled to face an additional 10% tariff starting on the 4th, easing concerns about a trade contraction for the time being.

However, the announcement of high tariffs not only on China, with which the trade dispute has been ongoing since 2019, but also on traditional allies and neighboring countries Canada and Mexico, delivered a significant shock to the international community. In particular, the fentanyl regulation, which President Trump cited as the justification for opening fire in the tariff war against these three countries, has re-emerged as a key issue both inside and outside the U.S.

Fentanyl is a surgical anesthetic developed in 1959 by the renowned Belgian medical scientist Paul Janssen. It is an innovative drug with a pain-relieving effect 100 times stronger than morphine. At the time of its development, it was regarded as a "miraculous painkiller" that brought innovation to major surgery and led to groundbreaking advances in high-difficulty surgeries such as open-heart surgery. However, in the 2000s, this drug began to be abused as a narcotic, becoming a serious social problem.

In particular, a new drug cartel was formed whereby fentanyl raw materials produced by chemical factories in China are routed through Latin American drug organizations and smuggled into the U.S. In this process, Chinese organizations purchase fentanyl raw materials from domestic chemical factories and pass them to Latin American groups, who process them into finished products and smuggle them into the U.S., establishing a systematic distribution network. This has developed into a widespread and organized criminal network covered by various media, including Netflix.

In September 2023, a bag of fentanyl drugs was found on the floor of a daycare center in New York, USA. AP·Yonhap News

The COVID-19 pandemic has further exacerbated the fentanyl problem in the U.S. The number of drug overdose deaths in the U.S., which was about 20,000 in 2001, exceeded 100,000 in 2021, increasing more than fivefold in 20 years. Even more shocking is that most of these deaths were found to be due to fentanyl overdose. This has emerged as a serious public health crisis in American society and has prompted the U.S. government to continuously raise the issue with China.

The Chinese government claims to enforce strict regulations, including the death penalty, on the production and distribution of finished fentanyl products. However, the U.S. side evaluates these measures as insufficient, while China shifts responsibility by arguing that stricter crackdowns on consumers within the U.S. are necessary. Amid this conflict, President Trump took a hardline stance by imposing high tariffs on Mexico and Canada, which lie along the fentanyl inflow routes.

However, this is considered a highly unusual measure in international trade relations. Even in sanctions against Russia related to the Ukraine war, sanctions on countries such as China, India, and Central Asian nations, which serve as bypass routes, were limited. This was due to concerns that comprehensive sanctions on countries along bypass routes could seriously undermine the global trade order. Therefore, the Trump administration's move is being pointed out as a dangerous precedent that could significantly contract global trade.

Moreover, since Mexico, Canada, and China are all countries with which the U.S. records its largest trade deficits, the move is gaining credibility as a pressure tactic aimed at improving the trade balance. In particular, Mexico has emerged as a major production base following the U.S.-China trade dispute and the reshoring strategies of American companies. During the process of relocating factories from China to the U.S., including Silicon Valley and other major U.S. manufacturers, the Mexico border area has become a new production hub due to relatively low prices and favorable exchange rates.

On the 3rd (local time), export containers at the port of Montreal, Canada. Photo by AFP and Yonhap News Agency

Canada holds an even more special position. Since the development of shale oil technology in the 2010s, Canada has risen to become the largest oil supplier to the U.S., replacing Saudi Arabia. Currently, the U.S. sources more than half of its oil imports from Canada, significantly reducing its dependence on Middle Eastern oil. However, the U.S. desires lower-priced oil imports and is increasing pressure on Canada to resolve its trade deficit.

In this situation, concerns are being raised that other trade surplus countries, including South Korea, may face similar pressure in the future. South Korea ranked 8th last year with a trade surplus of $55.6 billion with the U.S. What is more worrisome is that drug problems originating from China and North Korea are becoming serious in South Korea as well, and the country is being identified as a drug distribution route to third countries. This could provide the U.S. with a pretext to impose trade sanctions on South Korea under the guise of fentanyl distribution.

Trade experts analyze that the Trump administration's move is a strategic approach to leverage the public health issue of fentanyl in trade negotiations. This represents a new form of trade dispute reminiscent of the 19th-century Opium Wars, often called the "New Opium War," and is expected to bring fundamental changes to the global trade order. Particularly, if this move sets a new precedent for tariff imposition, there is great concern that the U.S. could impose sanctions on all countries along the distribution routes of goods harmful to itself in the future.

Accordingly, major trading countries, including South Korea, urgently need to closely monitor these new changes in the trade environment and prepare response strategies. Strengthening crackdowns on transnational crimes such as drug smuggling while making diplomatic efforts to find a new balance in trade relations with the U.S. will be necessary. Furthermore, the international community must distinguish between legitimate trade sanctions and excessive protectionism and seek to establish new norms to maintain the stability of the global trade order.

This content was produced with the assistance of AI translation services.