The planned tariffs that the US was set to levy on goods imported by Mexico and Canada today have been paused for 30 days. This comes after President Donald Trump signed three separate executive orders on Saturday declaring a national emergency and invoking the International Emergency Economic Powers Act (IEEPA), allowing the US to levy tariffs on goods imported from Canada, Mexico and China.
The president cited the threat posed by illegal border crossings and an influx of illicit opioids and other drugs as the impetus for the emergency declaration and subsequent tariffs.
The White House said on Saturday that, “until the crisis is alleviated,” the US, which is the largest export market for Canada and Mexico, would implement a 25% additional tariff on imports from Mexico and Canada (energy resources from Canada would have a lower 10% tariff) and a 10% additional tariff on imports from China.
Trump said that negotiations for an “economic deal” will continue to take place, separately, with Mexico and Canada during the 30-day tariff pause.
As for China, the 10% tariffs on imports from the country did take effect today.
China responded by saying it will implement a retaliatory 15% tariff on coal and liquefied natural gas products as well as a 10% tariff on crude oil, agricultural machinery and large-engine cars imported from the US. It also said it will launch an antitrust investigation into Google. The tariffs would take effect next Monday.
Mexican President Claudia Sheinbaum announced yesterday on X that after a “good conversation” with President Trump, Mexico would send 10,000 members of its National Guard to the US-Mexico border.
Trump, in his own statement, said, “We further agreed to immediately pause the anticipated tariffs for a one-month period during which we will have negotiations headed by Secretary of State Marco Rubio, Secretary of Treasury Scott Bessent, Secretary of Commerce Howard Lutnick, and high-level representatives of Mexico. I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a ‘deal’ between our two countries.”
Canadian Prime Minister Justin Trudeau, who also released a statement on X, said that Canada will implement a “$1.3 billion border plan, commit to appointing a Fentanyl Czar, list cartels as terrorists, ensure 24/7 eyes on the border and launch a Canada-US Joint Strike Force to combat organized crime, fentanyl and money laundering.” Trudeau said he also signed a new $200 million intelligence directive.
“The tariffs will be paused for a 30-day period to see whether or not a final economic deal with Canada can be structured,” Trump said.
James W. Hughes, Ph.D., university professor, dean emeritus of the Edward J. Bloustein School of Planning and Public Policy, Rutgers University cautioned that even with the 30-day delay, economic uncertainty has been unleashed, and that uncertainty is “one thing the economy doesn’t appreciate.”
According to Peter Connolly, CEO of the New Jersey Manufacturing Extension Program, fuel, automotive, and agriculture would be the first products impacted with increased prices from potential North American tariffs. “We would see increased prices especially in the Northeast on fuel and agriculture,” he added.
“Obviously, these are very dynamic times, seeing tariffs imposed almost immediately and then paused for further discussion,” said NJBIA Chief Government Affairs Officer Christopher Emigholz. “At the same time, whenever or if these tariffs occur, the impacts will range widely from business to business, depending on how, if, or where they import and export materials, what their supply chains look like, and whether they can find cost-effective materials here in the US.
“With all that uncertainty, we maintain that free trade is good for business and tariffs are worrisome – though they could be used as leverage for other public policies, as we saw with the Mexico and Canada border decisions [yesterday],” Emigholz added. “With that in mind, our own state government can be taking certain steps to help.”
He said that this includes supporting in-state manufacturers impacted by tariffs and identifying domestic sources of goods that are critical to supply chains or other countries not currently targeted in tariff discussions that supply these goods.
“The bottom line is we hope broad tariffs on our largest trading partners do not take place. But we can’t stand still waiting for tariffs. We need to prepare to do what we can to help businesses that will be negatively impacted,” Emigholz added.
National Association of Manufacturers (NAM) President and CEO Jay Timmons said that while manufacturers understand the need to deal with any sort of crisis that involves illicit drugs crossing the US border, at the same time, protecting manufacturing gains that have come from a strong North American partnership is vital.
He lauded the United States-Mexico-Canada Agreement (USMCA), stating that it has strengthened North American supply chains and bolstered economic power across the region.
“Thanks to this agreement, one-third of critical US manufacturing inputs now come from Canada or Mexico, rather than from competitors like China that often engage in unfair trade practices,” Timmons said. “However, with essential tax reforms left on the cutting room floor by the last Congress and the Biden administration, manufacturers are already facing mounting cost pressures. A 25% tariff on Canada and Mexico threatens to upend the very supply chains that have made US manufacturing more competitive globally.”
According to NAM estimates, a 25% tariff on Canada and Mexico would add an estimated $144 billion a year to the cost of manufacturing in the US, which is calculated on the basis that in 2023, the value of industrial supplies, capital goods and automotive parts imports from Canada and Mexico totaled nearly $576 billion.
Timmons believes that the ripple effects from these tariffs will be severe, particularly for small and medium-sized manufacturers that lack the flexibility and capital to rapidly find alternative suppliers or absorb rising energy costs.
“These businesses—employing millions of American workers—will face significant disruptions. Ultimately, manufacturers will bear the brunt of these tariffs, undermining our ability to sell our products at a competitive price and putting American jobs at risk,” Timmons continued. “We stand ready to work with President Trump to ensure a trade strategy that reinforces American strength—holding bad actors accountable while preserving the gains of the successful USMCA and advancing policies that sustain manufacturing growth here at home.”
NJBIA is partnering with the National Association of Manufacturers by asking New Jersey businesses to take a brief survey about how their manufacturing operations will be impacted by new tariffs on goods they use that are imported from Canada and Mexico.
To access more business news, visit NJB News Now.
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