Trump Imposes Tariffs on Mexico, Canada, and China

On Saturday evening, President Trump signed executive orders to impose tariffs on Mexico, Canada, and China under the International Emergency Economic Powers Act (IEEPA). The White House announced that the move is intended to hold the US’ largest trading partners "accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country."

Tariffs Imposed on Canada and Mexico

The orders put 25 percent additional tariffs on imports from Canada and Mexico, with the exception of energy products from Canada, which will be subject to a 10 percent tariff. Imports from China will also face a 10 percent tariff. The tariffs are expected to take effect on Tuesday and could have significant ramifications for American businesses and consumers.

Impact on US Goods Imports

Mexico, Canada, and China are the top suppliers of US goods imports, each accounting for hundreds of billions of dollars’ worth of products coming into the country each year. The products span a wide range of categories, from agriculture to transportation/automotive, fuel, electronics, wood, furniture, alcohol, and more. Mexico and Canada dominate US imports of agricultural goods, with Mexico supplying items like fruits, vegetables, and nuts, and the bulk of imported animal products like beef coming from Canada.

Top US Imports from China

Imports of electronics have largely come from China, and Mexico follows closely behind. Trading Economics data show that machinery, toys, and games, furniture, and plastics are among the top goods imported from China in recent years. The electronics sector could take an additional hit down the line, as Trump has said he also plans to impose tariffs on imported semiconductors, along with pharmaceuticals and steel.

Leaders Respond to Tariffs

Leaders from Canada and Mexico have both responded to the tariffs, saying they would impose their own tariffs on US goods in retaliation. Canadian Prime Minister Justin Trudeau announced a 25 percent tariff on roughly $107 billion (155 billion Canadian dollars) worth of US goods, according to Reuters reports.

Concerns about the Impact on Consumers and Supply Chains

In a statement released after the announcement of the tariffs, John Murphy, U.S. Chamber of Commerce Senior Vice President and Head of International, warned that Trump’s new tariffs could negatively affect both consumers and the supply chains. "The President is right to focus on major problems like our broken border and the scourge of fentanyl, but the imposition of tariffs under IEEPA is unprecedented, won’t solve these problems, and will only raise prices for American families and upend supply chains," Murphy said.