White House confirms 25% tariffs to go into effect on Canada, Mexico

China will face a 10% tariff as of Feb. 1 as Trump seeks to pressure countries into slowing the flow of drugs, immigrants into U.S.

Subscriber: Log Out

The U.S. is set to implement 25% tariffs on imports from Canada and Mexico and 10% on items coming from China on Saturday, Feb. 1, White House Press Secretary Karoline Leavitt said on Friday.

Leavitt, when asked whether there would be any exceptions, said the full list would be available on Saturday.

“The president is intent on ensuring that he effectively implements tariffs while cutting inflation and costs for the American people,” Leavitt said. “If the president at any time decides to roll back those tariffs, I’ll leave it to him to make that decision. But starting tomorrow, those tariffs will be in place.”

Canadian Prime Minister Justin Trudeau said Canada will react in a “forceful but reasonable” way.

“If the president does choose to implement any tariffs against Canada, we’re ready with a response—a purposeful, forceful but reasonable, immediate response,” Trudeau reportedly told reporters on Friday, according to the Globe and Mail.

It was still unclear on Friday afternoon whether some items, such as oil, would be exempt. The New York Times reported that approximately one-third of all U.S. imports come from Canada, China or Mexico, including 60% of imported crude oil, fruits and vegetables, and clothing including 99% of all shoes sold in the United States, according to the Footwear Distributors & Retailers of America, and auto parts and vehicles.

Trump is seeking to use the tariffs as a way to increase leverage on the three countries to stop the flow of immigrants and drugs into the U.S.

According to an article from Supply Chain Management Review’s sister publication, Logistics Management, there are a few areas that could be impacted more than others.

In a research note, S&P Global Ratings observed that with a 25% tariff by the U.S. on imports from Canada and Mexico, there are a few sectors that could be the most impacted, noting that based on global input-output tables, output from the auto and electrical equipment sectors is most exposed to a tariff shock in Mexico, with commodity-related processing sectors having the largest Canadian exposure. As for the U.S., the firm said it estimates a much smaller output at risk if its direct neighbors were to impose in-kind tariffs, with the most exposed sectors being agriculture and fishing, metals, and autos.

“We anticipate Canada would then respond in kind by also implementing a 25% across-the-board tariff on U.S. imports,” said Satyam Panday, chief US and Canada economist, S&P Global Ratings.

And Elijah Oliveros-Rosen, chief emerging markets economist, S&P Global Ratings, explained that, regarding Mexico, his firm believes it it’s very unlikely the government would place tariffs on U.S.-manufactured imports, given most are intermediate goods eventually exported to the U.S.

“Therefore, we expect the Mexican government could impose tariffs on agricultural and food imports, but not manufacturing,” he said.


For more impact on the tariffs, read: Industry stakeholders assess impact of anticipated tariffs

Jeff Berman, editor of Logistics Management, contributed to this report

SC
MR

A White House spokesperson said President Donald Trump has approved tariffs of 25% on Canada and Mexico and 10% on China as of Feb. 1. It is unclear if there will be any exceptions.
(Photo: Getty Images)
A White House spokesperson said President Donald Trump has approved tariffs of 25% on Canada and Mexico and 10% on China as of Feb. 1. It is unclear if there will be any exceptions.
What's Related in Tariffs
In Transit Podcast: Understanding the impact of Trump on shipping and trade flows
In this episode of the In Transit Podcast, Jono Liu, vp of global sales & marketing at Dimerco Express Group, joins host Vishnu Rajamanickam…
Listen in

About the Author

Brian Straight, SCMR Editor in Chief
Brian Straight's Bio Photo

Brian Straight is the Editor in Chief of Supply Chain Management Review. He has covered trucking, logistics and the broader supply chain for more than 15 years. He lives in Connecticut with his wife and two children. He can be reached at [email protected], @TruckingTalk, on LinkedIn, or by phone at 774-440-3870.

View Brian's author profile.

Subscribe

Supply Chain Management Review delivers the best industry content.
Subscribe today and get full access to all of Supply Chain Management Review’s exclusive content, email newsletters, premium resources and in-depth, comprehensive feature articles written by the industry's top experts on the subjects that matter most to supply chain professionals.
×

Search

Search

Sourcing & Procurement

Inventory Management Risk Management Global Trade Ports & Shipping

Business Management

Supply Chain TMS WMS 3PL Government & Regulation Sustainability Finance

Software & Technology

Artificial Intelligence Automation Cloud IoT Robotics Software

The Academy

Executive Education Associations Institutions Universities & Colleges

Resources

Podcasts Webinars Companies Visionaries White Papers Special Reports Premiums Magazine Archive

Subscribe

SCMR Magazine Newsletters Magazine Archives Customer Service

Press Releases

Press Releases Submit Press Release