As 25% tariffs on imports from Mexico and Canada are set to take effect, Hispanic-owned businesses and companies reliant on cross-border trade are feeling the impact. These businesses are already passing on higher prices to consumers and preparing to reduce imports significantly.
The looming North American trade war has caused global economic turmoil, with consumer confidence dropping, inflation worsening, and the auto sector and other domestic manufacturers bracing for a downturn.
Despite concerns that tariffs lead to higher consumer prices, President Trump dismissed this notion as a myth. Economic modeling suggests that tariffs will result in billions of dollars in tax hikes nationwide, with a potential offset by a stronger U.S. dollar.
Businesses along the border are already experiencing price hikes in anticipation of the tariffs, leading to disruptions in various sectors. For instance, a distributor representing Mexican farming companies plans to raise prices on imported products starting Tuesday, potentially leaving perishable vegetables unsold.
Retailers and restaurants are also feeling the impact, with some stockpiling goods and adjusting menus to cope with rising costs. Small businesses, in particular, are vulnerable to bearing these additional costs and passing them on to consumers due to limited operating revenue.
Arizona, which benefits from significant cross-border trade with Mexico, is facing economic strain. Businesses in Mexico have already raised prices in anticipation of tariffs, affecting consumers on both sides of the border.
Furthermore, increased tariffs on steel and aluminum imports could make housing more expensive and squeeze profit margins for small businesses in the construction sector. Construction businesses fear delays in future projects as prices fluctuate, forcing them to decide whether to pass costs on to consumers or absorb them internally.
