Trump could be set to announce tariffs against Canada, China and Mexico. Here’s what to know.
On the day of the inauguration, President Trump threatened a huge tariff on major US trading partners. Now he may be ready to deliver.
Mr. Trump said on January 20 that he could announce a 25 % tariff on Canada and Mexico And February and February. 1China You can face 10 % responsibilitiesEssence Economists warn that serious tariffs Can wake up inflation In terms of a series of consumer goods and economic growth. This is what experts say.
Why does Trump threatened to fight the country with tariffs?
Mr. Trump threatens tariffs on multiple countries for various reasons. He said he was specialized For Canada, Mexico Tariffs with China forced them to take action to stop the flow of unlicensed immigrants and illegal drugs into the United States
Before Mr. Trump took power, he threatened 60 % of Chinese goods A measure of a measure said that importing to the United States aims to promote the benefits of better negotiations between the United States and Beijing, and to promote illegal entry of Fentney’s entry into the country.
In the case of showing how his government used tariffs on other issues to the country, Trump proposed a 25 % tax on Columbia last week unless it agreed to accept the deportation of unauthorized immigrants. Colombia finally agreed to accept immigration, Reserved tariffs.
Columbia’s about Canada and Mexico can also reach an agreement with the United States and avoid painful trade war. To this end, Trump’s Minister of Commerce Howard Lutnick said at a confirmation hearing on Wednesday that Canada and Mexico can avoid tariffs by closing the border of fentanyl.
Lutnik told the senators: “As far as I know, they are acting quickly. If the operation is executed, there will be no related tax.”
Even so, Mr. Trump waved potential tariffs (even if he was never imposed) emphasized that he was willing to take difficult trade measures to punish the country’s closest allies unless they made concessions.
Gregory Daco, chief economist of EY-PARTHENON, said in a research report: “As we previously pointed out, trade policy will be used for trade protectionist measures for ransom trade, immigrants and other political offers in the next four years.”
What is Trump’s plan?
Experts say that the Trump administration can also choose to collect tariffs on various countries in Asia, South America, Europe, and other regions, rather than targeting various countries. However, it is unclear what tariffs can be deployed, how to build and deploy their possible timetables.
Brett House, a professor of economics at Columbia Business School, told CBS Moneywatch: “I think we must assume that some kind of tariffs will impose a tariff on the main trading partners in the United States.” “Finally, the president announced a lot of things on social media. This storm will not be the most positive and immediately pursuing this storm. ”
In contrast, it is clear that the new government is joining Mr. Trump’s place where the use of trade policy as the first term of economic and foreign policy tools. John Lash, vice president of supply chain software company E2OPEN product strategy, said that this is likely to lead to uncertainty and volatility.
DACO told CBS MoneyWatch in an interview: “There are still many alternatives.” “We don’t know, but the game theory suggested that the president imposed tariffs on Mexico and Canada instead of blanket tariffs, but not the blanket tariffs, but from the two countries. The tariffs made in a certain amount of imports … because his virtual momentum, otherwise his virtual momentum will be called
Dako pointed out that regarding the effectiveness of any tariffs, Mr. Trump can take action by claiming that he can quickly take action According to the authority of 1977 law Known as the “International Economic Economic Law”.
“When he said that he would levy tariffs on February 1, this was still a suspended problem. The deadline for concessions was obtained?” Dako said.
Will the United States face revenge?
Economists say it is almost sure. If Trump officials submit tariffs to its northern neighbors, “we expect that Canada will respond to comprehensive tariffs on importers in the United States,” SE & P Global Ratings, the chief of the United States and Canadian economist, Satyam Panday, explain.
Elijah Oliveros-Rosen, the chief emerging market economist at Standard Purcera’s global ratings, predicts that Mexico will also be fired with targeted tariffs. “As far as Mexico is concerned, we believe that the government is unlikely to impose tariffs on imported goods we manufactured. In view of most of the intermediate goods, it is expected to be exported to the United States. “” “
Mr. Trump said that strengthening the US’s position on trade issues will help protect American workers and lead to the revival of domestic manufacturing. Douglas Irwin, a professor of economics at DARTMUTMAUTH College, said that this policy may cause the cost of critical relationships with other countries in the world.
What are the risks of American consumers?
Irwin and other economists said that tariffs can almost definitely bring higher prices to American consumers. This is because companies that eventually hang on the hooks usually increase the cost of consumers to protect their bottom line.
DACO told CBS Moneywatch: “The concept that the government has always adhered to is a bit surprising-if you move over time, it will gradually levy and gradually tariffs, such as 5 % incremental increase, that is, the inflation rate is small. “This idea is misleading, because if you increase the price rising monthly month by month, if there is anything that will cause higher inflation expectations.
According to an analysis of capital economics this week, if Mr. Trump’s tariffs have been implemented, including universal taxes on all commodities, the price inflation rate of consumers may increase by 3 % to 4 %. To be sure, the analysts of the investment consulting company expect Mr. Trump to stop levying the blanket tariff, but choose his goal.
The company said: “Nevertheless, any of the tariffs on these proposed targets will generate a rebound of consumer price inflation this year, making it higher and making the United States more difficult to restore loose monetary policy.”
