The United States Has Raised Tariffs on Canadian and Mexican Goods

• The tariff on Canadian goods has increased to 35%, but the majority of exports will remain duty-free.
• The USMCA agreement protects the majority of goods from tariff collections.
• Canada is considering the possibility of eliminating certain tariffs on goods from the USA.

This was reported by ABC News, RBC Ukraine.

Toronto — US President Donald Trump has raised tariffs on Canadian goods to 35% last week, but key exemptions for Canada and Mexico protect the majority of goods from these mandatory collections.

Goods that comply with the trade agreement of the United States, Mexico, and Canada 2020 (USMCA), which Trump signed during his first term, are not subject to tariffs.

The Bank of Canada reports that 100% of energy exports and 95% of other exports comply with USMCA standards. The Royal Bank estimates that over 90% of Canadian exports may be able to enter the US market duty-free in April.

Canadian Prime Minister Mark Carney noted that the obligations of the United States regarding the foundations of the USMCA, confirmed last week, indicate that the average tariff rate in the US on Canadian goods will remain one of the lowest, while around 85% of trade between Canada and the US continues to be duty-free.

However, Trump also discussed the 90-day renegotiation period with Mexico, which is one of the largest trading partners of the US. Existing tariff rates at 25% will remain in effect, although he hinted at raising them to 30%.

This 25% applies only to certain trade between Mexico and the US that does not fall under USMCA. Mexican President Claudia Sheinbaum emphasized that Mexico still holds the best position under the free trade agreement.

The majority of imports from Canada and Mexico are still protected by USMCA, but the agreement is subject to review next year. US Trade Minister Gohvard Lutnik noted last month that the president will likely initiate negotiations regarding USMCA.

The loss of the agreement could lead to serious economic consequences, as over 75% of Canadian exports and over 80% of Mexican exports go to the US.

In addition, Carney noted that Canada could consider the possibility of eliminating certain tariffs on goods from the US to minimize harm to Canadian companies.

Tags: USA/Economy