On Saturday evening, Trump signed executive orders to impose tariffs on Mexico, Canada and China under the International Emergency Economic Powers Act (IEEPA), with a White House fact sheet claiming the move is meant 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.” The orders put 25 percent additional tariffs on imports from Canada and Mexico, the one exception being that energy products from Canada will be subject to a 10 percent tariff. Imports from China will also face a 10 percent tariff.
The broad tariffs are expected to take effect on Tuesday and could have ramifications not only for American businesses, but for consumers too. 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, data from the US Department of Commerce and the US International Trade Commission show. Those 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, according to Trading Economics and the US Department of Agriculture. The two countries have also been our top suppliers for transportation equipment, including cars and car parts, and crude oil. Canada is responsible for almost 60 percent of US crude oil imports according to the Congressional Research Service, which noted in a report last month that the new tariffs “might affect the U.S. crude oil market and consumer fuel prices.”
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Imports of electronics have largely come from China, and Mexico follows closely behind. Trading Economics data also show machinery, toys and games, furniture and plastics 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 from Canada and Mexico have both responded to the tariffs, saying they would impose their own on US goods in retaliation. Canadian Prime Minister Justin Trudeau on Saturday announced a 25 percent tariff on roughly $107 billion (155 billion Canadian dollars) worth of US goods, Reuters reports.
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. “The Chamber will consult with our members, including main street businesses across the country impacted by this move, to determine next steps to prevent economic harm to Americans.”
