On March 4, the 25-percent tariffs of the US administration for goods imported from Canada and Mexico entered into force, and the existing tariffs for Chinese goods were doubled from 10 to 20 percent.
The above countries, in respect of which tariffs were introduced, said that they would answer Trump’s duties with return measures. This situation has strengthened fears about the trade war in world markets.
Representatives of the Trump administration claimed that the tariffs for Canada and Mexico are part of the “fighting drugs”, not a trade war. They warned that on April 2, new tariffs related to trade policy could come into force.
In addition, US President Trump repeatedly repeated that he would continue to increase tariffs if countries answer them with return tariffs.
The United States carries out more than 40 percent of its entire trade with Canada, Mexico and China
Tariffs introduced by the United States against Canada, Mexico and China, one of their largest trading partners, and after that the reciprocal steps threatened the trade in US goods with these countries worth about 2.2 trillion dollars.
According to the US Department of Trade, the volume of trade in goods with Mexico in 2024 reached $ 840 billion, of which about $ 506 billion had to be imported and $ 334 billion for export. The shortage of trade balance with Mexico amounted to $ 172 billion.
Import from Canada last year amounted to about $ 413 billion, and export to this country – $ 349 billion. While the US trade with Canada exceeded $ 762 billion, the deficit of trade in goods with this country amounted to $ 63 billion.
Although the country with the least volume of trade in goods among three countries in 2024 was China with $ 582 billion, the deficit in favor of China exceeded $ 295 billion. While US export to China amounted to about $ 144 billion, the import of goods from this country approached $ 439 billion.
Thus, the deficit of the trade in goods with Canada, Mexico and China, with which the United States carries out more than 40 percent of its entire trade, amounted to about $ 531 billion.
Trump’s actions are closely watching
In addition to tariffs against Canada, China and Mexico, Trump’s agenda also includes issues such as the introduction of tariffs for cars, medicines and chips imported into the United States, the introduction of 25 percent tariffs against the European Union (EU) and 100 percent tariffs against the BRICS countries if they try to create a currency that will replace the dollar.
Economists warn that aggressive trading steps can lead to negative consequences, including provoking inflation around the world.
According to the analysis of the Institute of International Economics of Peterson (PIIE), Trump’s tariffs against Canada, Mexico and China will cost the average American household more than $ 1,200 a year.
= Inflational expectations can increase