Washington – President Trump slapped the radical tariffs of the goods of Mexico, Canada and China on Saturday, sending shock waves through the global supply chain and causing fears of a disruptive commercial war that could drastically increase costs for US consumers.
Trump signed executive orders that placed 25% tariffs in imports from Mexico and Canada, except for a 10% rate in Canadian energy products. He imposed a 10% tax on all imports from China. The White House said the tariffs would take effect on Tuesday and could be raised if the target countries retaliate with their own rates, since they have threatened.
In a publication on its social media platform, the president said he was taxing the three countries because they are not doing enough to stop the flow of undocumented immigrants and drugs in the United States.
Mexican president Claudia Sheinbaum was returned to Trump, detailing what her country has done to combat drug trafficking and slow migration and criticize the United States for its high levels of drug use. She said that Mexico would retaliate with her own tariffs on US imports, adding: “The problems are not resolved by imposing tariffs, but speaking and participating in the dialogue.”
Canadian Prime Minister Justin Trudeau, who had also promised retaliation tariffs, said in an X that “Canada is prepared.”
The two nations and China are the main commercial partners of the United States, which supply food, medications, oil, cars, wood and electronics.
Employees work at a Honda car plant in 2014, in Celaya, in the Mexican central state of Guanajuato.
(Eduardo Verdugo / Associated Press)
Tariffs against Canada and Mexico change from a commercial pact that dates back to three decades and is the acacculation of many industries closely integrated in North America. Trump himself signed the most recent version of the Trade Agreement during his first term, praising the 2020 Us-mexicocanada Agreement as “the most fair, balanced and beneficial trade agreement that we have signed in the law.”
Tariffs threaten to deeply interrupt the economies of Mexico, Canada and China and increase consumer prices in the United States.
Experts say that some effects will be significant and will feel quickly, and US consumers probably find higher prices for fresh vegetables and fruits and other perishable imports in a matter of days.
“Foreigners do not pay rates; American companies and consumers do it, ”said Jock O'Connell, Beacon Economics trade expert, a Los Angeles headquarters.
Americans are still intelligent due to an increase in food prices since the beginning of COVID-19 pandemic. High inflation was considered widely an important factor in Trump's elections, and the president has promised to reduce the prices of groceries and other goods. But these new tariffs are almost certain to do the opposite, economists say.
The United States imports more than $ 900 billion products from Canada and Mexico, and a 25% tariff is huge since the goods have crossed the US -free US borders for many years.
“Does the Trump administration feel comfortable when walking for the price of avocados and guacamole before the Super Bowl?” Joseph Brusuelas said, chief economist of the RSM Us accounting firm, adding that he was not joking.
For many other products, prices can begin to increase only as inventories run out. Automobile prices will almost surely increase. The manufacture of US cars. It is so interconnected with Mexico and Canada, with pieces that come and go through borders many times, that analysts say they are not really US cars but US cars.
The governor of Michigan, Gretchen Whitmer, condemned the tariffs and the effect they would have on the automotive industry in their state, who voted for Trump in 2024: “A 25% tariff will affect US automatic workers and consumers, increase prices in cars, groceries and energy for working families and putting countless jobs at risk. The Trump middle class tax increase will paralyze our economy and hit the families of working class and the especially hard blue class. ”
Gasoline prices can also increase, especially in the regions of large lakes and Rocky Mountain West, which depend on Canadian oil. Trump has repeatedly talked about reducing the cost of gas, but the United States still matters billions of dollars of crude oil, and increasing national production is not so easy or fast.
The steam rises in the installation of Suncor's Oil Sands near Fort McMurray, Canada, in September 2023.
(Victor R. Caivano / Associated Press)
10% tariffs in China will increase duties from 10% to 25% that Trump imposed on many Chinese imports during his first term, and that former President Biden maintained in his place. That will reach American family pockets in general because China is a great supplier of consumer items.
According to the American-Mexico-Canadá trade agreement, any country has the right to withdraw at any time. And a president of the United States can impose new tariffs without the approval of the Congress invoking the International Law of Emergency Economic Powers, which authorizes the Executive Action to counteract threats to national security, foreign policy or economy.
Trump had been warning for months that he planned to impose tariffs on imports in an attempt to attract the manufacture of return to the United States. Campaigning before the November elections, at one point promised to establish a general tax of 10% or 20% in all goods that enter the US.
“Come and make your product in the United States,” he told companies in a video speech in the World Economic Forum in Davos, Switzerland, last month. If not, he said: “Then, very simply, you will have to pay a rate.”
But Trump sees tariffs also as a negotiation tactic to extract commitments from other nations in matters that have little to do with trade.
Its executive order imposes tariffs against Canada blames the country for “not dedicating enough attention and resources or coordinating significantly with the United States police partners to effectively stop the tide of illicit drugs.”
He has said that Mexico must suffer tariffs because it has not done more to prevent migrants from reaching the US border.
But experts questioned the ability of Canada and Mexico to stop drugs and smuggling of people. A 2022 report commissioned by the United States Congress discovered that “it is not known that Canada is an important source of fentanyl, other synthetic opioids or precursor chemicals for the United States, a conclusion mainly extracted from the data from seizures” .
Others said that tariffs have the potential to stimulate more migration.
Economies in Mexico and Canada depend much more in the United States than the other way around, and the threat of tariffs has made the dollar and the very volatile Canadian dollar in recent weeks.
The value of exports and imports from Mexico amounts to almost 90% of the country's gross domestic product, according to World Bank data. Economists warn that even a small increase in tariffs on goods for the United States raises serious risks to the economy.
“In the worst case, the Mexican economy will fall into the recession, the currency will depreciate and increase inflation,” reads a report published by the economic research firm Moody's Analytics.
Analysts say that if tariffs drag the Mexican economy, more Mexican workers without adequate documentation will seek to enter the United States.
“If Mexico enters a recession, you will see an increase in immigration,” said Economist Brusuelas.
Migrants go to a border patrol after crossing illegally and wait to request asylum between two border walls that separate Mexico and the United States on January 21 in San Diego.
(Gregory Bull / Associated Press)
Evan Ellis, professor of Latin American research at the Institute of Strategic Studies of the US Army College, described tariffs as a “catastrophic risk.”
“If essentially, six deep in the Mexican economy … there are people who will flow once again through the American border,” he said.
The country's economy is already in unstable terrain. Mexico faces its greatest budget deficit since the 1980s. The data shows that 36% of the population lives in poverty, with 7% of extreme poverty.
A severe recession in Mexico in the 1990s contributed to about 5 million Mexicans who immigrate to the United States.
Canadian officials have promised an aggressive response.
“Being intelligent means retaliation where it hurts,” said Chrystia Freeland, former finance minister who represented Canada in the USMCA negotiations. “Our counterweight must be dollar per dollar, and must be directed precision and painfully: Florida orange growers, Wisconsin dairy producers, Michigan dishwasher manufacturers and much more.”
If China, Canada and Mexico retaliate imposing tariffs on US products entering their markets, that will probably stop the volume of trade. The undulation effects will be felt throughout the supply chain, harming businesses and employment in ports, warehouses and other logistics and transport operations.
Higher tariff inflation can affect angels, especially hard, shortly after fires, which seem to be raising rental prices and other services and products.
“The moment could not be worse. It will be a double blow to the southern California, ”said Sung Won Sohn, professor of finance and economy at Loyola Marymount University.
During his first mandate, Trump in 2018 imposed tariffs on the steel of Mexico and other countries, which caused counter-to-to-work in US agricultural products and forcing relations between the United States and Mexico.
At that time, he also threatened broader tariffs in all Mexican goods, but finally backed down after American business leaders complained that they would harm them and their administration extracted a promise from Mexican authorities to make more to prevent migrants from arriving to the border of the United States.
Marcelo Ebrard, Secretary of Economy of Mexico, suggested last year that the sole objective of tariffs is to achieve political profits, given the composition of the highly integrated global economy.
“The economy of the United States is not a manufacturing economy,” said Ebrard. “And I'm sorry, but it won't be so.”
Linthicum reported from Albuquerque and Lee reported from Washington. The researcher Cecilia Sánchez Vidal in The Times Mexico City of Mexico City and writer Sema Mehta contributed to this report.
