Calling the promise of another campaign, newly elected US President Donald Trump may be close to a step to place 25% tapic on goods imported from Canada and Mexico. For things from China, he is planning to add 10% tariffs.
Prior to its inauguration, Trump announced that tariffs on Canada and Mexico were one day -1 priority. When this did not happen, many were relieved. He later announced that the tariff would be implemented on 1 February.
According to the US department, the movie, which will come exactly two weeks after returning to the White House, hits America’s largest trading partners. Commerce’s Bureau of Economic Analysis.
At the same time, Canada and Mexico sent $ 1.01 trillion goods to the US. The US trade deficit with Canada is more than $ 40 billion, while the trade deficit with Mexico is more than $ 162 billion.
Using TATFs as a trump tool
Most economists think that tattifies want sunny prices for American consumers. Trump expects a different effect.
For him, Tarrafs are a way of cutting the “unfair” trade deficit of the country, adding domestic manufacturing capacity through purchasing an American push and generates government revenue.
Additionally, TOTFs have a cell phone equipment in other talks such as keeping immigrants out with the war and southern border of the country on drugs.
Trump has so far avoided the implementation of universal tapiff on all imports in the country, something that he had threatened during the campaign.
Canada and 25% US Tatur
Tariffs for Canada come at the time of political instability.
Prime Minister Justin Trudeau was in a hurry to visit the Presidential-Election in Florida, but Trudeau will be rebuilt soon after leaving the leadership of the Liberal Party.
The new Canadian leader will have to face the vote of mistrust in Parliament in March or the fresh parliamentary election will call him or himself. A new election wants to put the conservatives back to power in Ottawa in such a way, which delayed any response to the new US President.
While the country occupies itself, it will be difficult to deal with external forces like us. At a time when Trump repeatedly believed Canada, saying that it could become the 51st state of the United States.
Mexico and 25% US Tatur
On 20 January, Trump announced a national emergency on the southern border and sent additional military support to the Homeland Security Department. Hey changed the name of the Gulf of Mexico to the Gulf of America, at least officer in America.
For Mexico, fresh US taffs are not a matter of laughter because its economy is fully associated with the US. Nevertheless, Mexico has been vocal in its neighbor’s perspective.
In November, Mexico President Claudia Shinbam said that “one tariff will be followed by the other.” Last week, she said that she would stand for the US which is the remaining creative. “It is important to always keep a cool head and mention the agreements signed beyond real speeches,” he announced.
Close to the time limit of February 1 on Wednesday, Shinbam said: “We don’t think it’s really going to happen,” adding, “If this happens, we have our plan.”
Investment in Mexican manufacturing has been the first term of Trump’s post as businesses have benefited from cheap labor and the United States-Maxico-Canada Agreement, which came into force in July 2020 and changed the North America Free Trade Agreement.
Trump, who helped to interact on the deal, now says that it is “the worst trade deal” and wants to reuse it as soon as possible. Tariff danger can increase the deadline that time.
Investment in Mexico instead of China
Car manufacturing and Chinese companies, in particular, have set up shops to move around tetf on direct imports from China in Mexico.
Converting raw materials into finished goods can mean singing things from across the border to beyond and back – sometimes many times. Adding a Taiach time a product crosses the US border, ends or not, the supply network will make the network too much. Production facilities can prevent production.
Companies in Mexico may have to reconsider their investment and where they make things. Elon Musk’s employed Tesla Factory Hold in Nuevo Leon.
Mexico and Canada hope that their proximity with the US and the fact that they are not China can help them. Nevertheless, both are preparing the worst. To please Washington and to close the tattifs, both have increased border security to prevent migrants and drugs.
Officials have allegedly made a list of American products that they can hit with counter tounz. Canada can export oil and electricity back. To keep the North American borders open, Mexico China may threaten to increase economic relations with archery.
Will North America suffer together?
“Economic results of such tattifies will be serious for North America, potentially create significant disruption for growth and business relations,” Julian Hinz wrote last week,
Director of Research for Trade Policy at Kail Institute for the World Economy has calculated that it can cause a decline of 4.1% in GDP for both Mexico and Canada in the first year, because about three quarter total exports America Go in
Other, like the Peterson Institute for International Economics, 25% of the Tarats on Canadian and Mexican Goyolds say that there is pain for the three. It would be bad for the Canad, but for Mexico it will be “frightening” because they are more dependent on the US. This will increase some prices in America.
“For the second Trump administration period, the US GDP will be about 200 billion dollars, which would have been with tifs,” Senior researchers Warvik J. McKibin and Marcus Noolland wrote In mid -January. “Canada will loose $ 100 billion from a very small economy, and at its peak, the tariff will knock 2% from the growth rate of Mexico.”
Finally, there are many open questions. Will American courts attack tariffs, will there be vengeance or discount for some industries? In addition to tariffs, the search for uncertainty is bad for business and will eventually damage all sides.
Edited by: Uwe Hessler
