The US President Donald Trump has announced a bold move that’s sending shockwaves through North America’s economy. Starting either on time or by March 4, 2025, a hefty 25% tariff will be imposed on imports from Canada and Mexico.
These tariffs cover a staggering $918.54 billion in imports, marking them as the largest in world trade history. With these measures, nearly 28% of the US’s total imports worldwide will be affected, setting the stage for major economic shifts in 2024.
Canada and Mexico are no strangers to this trade relationship, with the US accounting for 75% of Canada’s and 80% of Mexico’s exports in 2024. This decision not only threatens their export markets but is also expected to hit the US economy hard, potentially driving up inflation.
Adding fuel to the fire, both Canada and Mexico have hinted at retaliatory actions. This could lead to a significant downturn for US exports to these nations, which make up about one-third of its global market.
The trio has long relied on the USMCA agreement, fostering a supply chain built on zero tariffs. This abrupt 25% tariff threatens to unravel that delicate balance, causing disruptions across industries.
Energy is also in the crosshairs. Despite being a leading oil and gas producer, the US heavily relies on imports, with Canada supplying 60% of its needs. While oil and gas imports face a lower 10% tariff, manufacturers and consumers might still face rising gas prices, potentially prompting Canada to shift its market focus.
As these changes unfold, all eyes will be on how North America navigates this turbulent trade landscape. Stay tuned for more updates on this developing story! 🌍💬✨
