The United States is set to roll out unprecedented 25% tariffs on imports from Canada and Mexico, a move announced by President Donald Trump on Tuesday. Scheduled to take effect on March 4, 2025, after a one-month delay, these tariffs will impact a staggering $918.54 billion in imports, marking the largest volume affected in world trade history.
These tariffs will significantly disrupt the economies of both Canada and Mexico, as the US accounts for 75% of Canada's exports and 80% of Mexico's in 2024. The repercussions will ripple through the North American supply chain, historically built on the zero-tariff USMCA agreement, potentially leading to severe economic strain on all parties involved.
Moreover, the imposition of these tariffs is expected to trigger retaliatory measures from Canada and Mexico, further harming US exports, which constitute one-third of the country's global market. This trade tension is also poised to elevate inflation rates within the US, affecting both manufacturers and consumers.
In the energy sector, while the US remains a leading producer and exporter of oil and gas, it relies heavily on imports from Canada, which supplied 60% of the total $176.47 billion in 2024. Although oil and gas imports are subject to a lower 10% tariff, the increased costs are likely to drive up gas prices and potentially shift market dynamics in favor of Canadian suppliers.
As the global community watches these developments, the long-term impact on the North American economy and international trade relations remains uncertain. Businesses and consumers alike brace for the potential disruptions and economic shifts that this historic tariff implementation may bring.
Reference(s):
cgtn.com
