(The Lion) — President Donald Trump has delayed the Mexico tariffs from going into effect to allow for high-level trade talks between Mexico and the U.S., he announced Monday.

Trump described his conversation with Mexican President Claudia Sheinbaum as “friendly,” saying Mexico has agreed to deploy 10,000 troops on the U.S. border to combat illegal immigration and drug trafficking.

“We further agreed to immediately pause the anticipated tariffs for a one-month period during which we will have negotiations headed by Secretary of State Marco Rubio, Secretary of Treasury Scott Bessent, and Secretary of Commerce Howard Lutnick, and high-level Representatives of Mexico,” said Trump. “I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a ‘deal’ between our two Countries.”

Sheinbaum confirmed the deal with a similar post on X.

She said the U.S. and Mexico agreed to “begin working today on two fronts: security and trade. … They are pausing tariffs for one month.”

The news comes as tariffs on Canada and China are set to take effect on Tuesday if a deal like the one with Mexico isn’t in place with the U.S.

In an executive order Trump set tariffs on Canadian goods to increase 25%, with tolls on China trade set to increase 10%.

White House officials said that Canadian Prime Minister Justin Trudeau doesn’t quite understand what’s required from Canada to avoid the tariffs.

“The good news is that in our conversations over the weekend, one of the things we’ve noticed is that Mexicans are very, very serious about doing what President Trump said,” Kevin Hassett, the director of the White House’s National Economic Council, told the media, according to Reuters.

“Canadians appear to have misunderstood the plain language of the executive order and they’re interpreting it as a trade war,” Hassett added.

Reuters said that Trump told reporters on Sunday that Canada and China can avoid tariffs if they agree “to balance out their trade, number one.”

But they also have “to stop people from pouring into our country … they have to stop people pouring in, and we have to stop fentanyl.”

Canadian billionaire, Tobi Lutke, the co-founder of Shopify, slammed Canada’s response to the tariff threat.

“Canada thrives when it works with America together,” said Lutke on X. “Win by helping America win. Trump believes that Canada has not held its side of the bargain, and he set terms to prove that we still work together: get the borders under control and crack down on fentanyl dens.”

He said that the retaliatory tariffs on U.S. goods imposed by Canada’s Trudeau are the “wrong choice,” because much better options remain on the table.

Trudeau’s target tariff list goes after Trump allies in Republican states, a tactic that is similar to what China could do in trying to punish specific large American firms.

“If China threatens a handful of very big American companies and the stock market falls, that would give Trump pause” in a trade war with China, Derek Scissors, a China analyst at the American Enterprise Institute told Politico.

In his tariff order Trump noted that foreign trade accounts for 67% of Canada’s Gross Domestic Product (GDP), 73% of Mexico’s GDP, and 37% of China’s GDP while accounting for just 24% of U.S. GDP.

In 2023, the U.S. trade deficit in goods was the world’s largest at over $1 trillion, said the order.

“Though previous Administrations have failed to leverage America’s combination of exceptional strength and its unique role in world trade to advance the security interests of the American people, President Trump has not,” the order continued.

The tariff threats are keys to several issues Trump has promised to address: increasing trade and jobs for American workers, stopping illegal immigration and the flow of drugs into the U.S. and addressing competition with China.

Trump acknowledged the tariffs could bring temporary pain to American consumers, but promised that rebalancing trade would lead to a “golden age” for the U.S. economy.

Hassett said the new trade policy would have a positive effect on the economy.

“I think this is going to be one of the biggest supply-side positive shocks that we’ve ever seen,” he said, according to Reuters.

The stock market recovered early Monday losses after Mexico complied with Trump’s requests, triggering a tariff pause for the southern neighbor.

The benchmark S&P 500 is down less than 1% since the Trump tariff order went out.

In January, the stock index gained 2.7% for the month, on pace for annualized returns of 32.4%, despite trade war talk.