US President Donald Trump has announced that sweeping tariffs on Canada and Mexico will take effect on Tuesday morning, imposing a 25% fee on all exports crossing their borders. The move aims to pressure these countries into stopping the flow of deadly drugs and migrants to the US. However, the tariffs will have significant consequences for companies relying on international supply chains and American consumers.
The decision comes after Canada and Mexico agreed to measures such as increasing troops along their shared border and appointing a “fentanyl czar” in an effort to avoid the tariffs. Trump had previously threatened to impose levies on these countries but paused them for one month before announcing their reinstatement.
The new tariffs, combined with existing levies on Chinese goods, will have significant impacts on US trade and consumer costs. Companies that rely heavily on international supply chains are particularly concerned about the increased costs.
Canada and Mexico are heavily dependent on exports to the US, making this move a significant disruption to their economies. The imposition of 25% tariffs is expected to raise average US tariff rates to levels not seen since the 1940s, according to Chad Bown, senior fellow at the Peterson Institute for International Economics.
Source: https://www.nytimes.com/2025/03/03/business/economy/trump-tariffs-china-mexico-canada.html