President Donald Trump has floated 25 percent tariffs on Mexican and Canadian imports, set to take effect on February 1. If implemented, these tariffs wouldn't just hurt the Canadian and Mexican economies, but also make American consumers poorer and domestic manufacturers less competitive.
From January 2024 through September 2024, total trade between the U.S. and Mexico surpassed $700 billion, while trade with the U.S. and Canada came just short of that figure. Canada and Mexico are also America's two largest export markets: $325 billion and $275 billion worth of goods and services were sold to Canada and Mexico, respectively, over the first three quarters of 2024.
U.S.-levied tariffs would hurt all countries involved. Research conducted by the Peterson Institute for International Economics predicts that 25 percent tariffs on Canada and Mexico would decrease American gross domestic product (GDP) by $200 billion, Canadian GDP by $100 billion, and Mexican GDP growth by 2 percent. These tariffs would also diminish American manufacturing.
