Donald Trump defends tariffs on Mexico as stock markets reel

After 5% tariff announced, president tweets 'Mexico has taken advantage of the US for decades'

Donald Trump has defended his decision to impose new tariffs on Mexico as stock markets worldwide were rattled by fears of an escalation in trade tensions.

"Mexico has taken advantage of the United States for decades," Trump tweeted. "Because of the Dems, our Immigration Laws are BAD. Mexico makes a FORTUNE from the U.S., have for decades, they can easily fix this problem. Time for them to finally do what must be done!"

Related: Markets shaken as Trump announces shock Mexico tariffs - as it happened

Tariffs are border taxes charged on foreign imports. Importers pay them upon entry to the customs agency of the country or bloc imposing them.

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