President Donald Trump on Monday agreed to a 30-day pause on his tariff threats against Mexico and Canada as America's two largest trading partners took steps to appease his concerns about border security and drug trafficking.

Last-minute phone calls pull the North American neighbours back from the brink of a trade war, but the US is still targeting Chinese imports.

U.S. tariffs of 10% on Chinese imports came into effect on Tuesday, risking a renewed trade war between the world's top two economies as President Donald Trumppunishes China for not halting the flow of illicit drugs.