During President-elect Donald Trump’s first term, the United States engaged in a trade war with China under the premise of boosting US manufacturing, safeguarding national security interests, and addressing what was perceived as an imbalanced trade relationship. President Joe Biden has maintained most of the tariffs imposed during Trump's tenure and has even introduced additional ones. This ongoing trade dispute has led to increased costs for US consumers purchasing goods imported from China.
Now, Trump is shifting his focus towards America's largest and third-largest trading partners, Mexico and Canada. He has announced plans to implement a new 25% across-the-board tariff on all goods imported from these two nations starting January 20, the day of his inauguration. These tariffs would impact goods that currently enter the US duty-free under the US-Mexico-Canada Agreement (USMCA).
If Trump proceeds with this tariff plan, consumers could face higher prices on various products sourced from Mexico and Canada. Items such as gas, produce, and cars, which are commonly imported from these neighboring countries, may become more expensive for American consumers.
The potential escalation of trade tensions with Mexico and Canada raises concerns about the economic impact on consumers and businesses in the US. The imposition of tariffs could disrupt supply chains, increase production costs, and ultimately lead to higher prices for consumers.
As the situation unfolds, it remains to be seen how the US government, under the new administration, will navigate trade relations with Mexico and Canada. The outcome of these trade negotiations will have significant implications for both American consumers and the broader economy.
