Canada Energy and Natural Resources Minister Jonathan Wilkinson discussed tariffs, energy exports, a US-Canada energy alliance and the possible Canadian election.
chairman Donald Trump’s Declaration of tariffs on Mexico and Canada, although delayed for at least one month, may increase prices paid by consumers for tariffs affected if they eventually come into force.
Trump announced the previous weekend that 25% tariffs, which are taxes on imported products, will be effective on products from Canada and Mexico from February 4 – as well as 10% less tariffs on Canadian energy products. Canada and Mexico threatened the anti -anti -counter tariff in response to Trump’s tariff schemes.
The President arrived at an agreement with Canada and Mexico, the two countries delayed tariffs for at least one month after announcing measures to combat fantanel smuggling and illegal immigration along the US border.
When Tariff on Canada and Mexico In time, their potential implementation in the future opens the possibility that American consumers can withstand high prices for some products if they are eventually effective.
What is happening with Trump’s tariff on China, Canada and Mexico?
President Donald Trump has postponed Tariff as a source of conversation equipment and tax revenue. (Chip Somodeville / Getty Image / Getty Image)
“The next month either the tariffs are applied to Mexico and Canada in the next month,” said Dan Svikas, VP of Policy and Government Affairs in the protection coalition of taxpayers, you will see that prices are high on much goods. ” Business.
VP Scott Linsicom, VP of General Economics and Trade Policy at the Cato Institute, said in an interview with Fox Business that “Three big areas for potential Consumer pain There will be food, energy and auto. ,
“On food, we import a ton fresh seasonal yield -beer … meat and some other things from Mexico,” they explained. “These are bad items that you cannot stockpile and in the case of avocados, there are not really suitable replacements in America or abroad. Given that Grosers in America have very little profit margin, you mandatory, you mandatory On the tariff, we will see any type of, the Mexican Avocados passed by the consumer – there is nowhere else for it. “
Voters reject Trump’s tariff push; Most believe that policy will harm the economy
Avocados are among the products of Mexico that can see the price increase when tariffs are effective. (Camillo Freedman / Bloomberg Getty Image / Getty Image)
Lincicome explained that Automatic industry The US, Canada and Mexico include the North American auto supply chain with suppliers and producers.
“You Apply tariff On these things and you are ensuring some kind of adequate cost increase for motor vehicle manufacturers in all three countries, and then the question is how much passes on it, “Lincicom explained.” Whom do you talk to, it is anywhere. A new car and again between $ 1,000 and $ 6,000, there are some amounts that can absorb manufacturers – of course, with low investment and hiring and output in the process. ,
“We import a lot Crude oil From Canada, and it is a type of crude oil that we do not actually make in America, it is a heavy raw. Some refineries, especially in midwests and mountain waste, are designed to process crude of that type, and they cannot actually process light crude that America makes cheaply or easily, “he Explained.
Trump’s ‘External Revenue Service’ will gather from importers, not ‘foreign sources’
Interconnected North American Auto Supply Chain may have more new car prices than tariffs. (Michael Tercha/Chicago Tribune/Tribune News Service through Getty Image/Getty Image)
Lincicome said that some prices will increase in all three countries on equipment such as washing machines, dishes and air conditioners.
Other products that were noted by social development can see the price increase due to tariffs, including lumber and related products, which look at tomato products from Mexico, along with the amount of canadian wood imported by the US.
Brandon Parsons, an economist at Graziadi Business School at the University of Peepardine, told Fox Business that his research suggested consumer price IndexA popular inflation gauge, tariff can increase by 1.3 percentage points.
Suppose that CPI was 2.9% in DecemberThis can push inflation above 4% – a level that doubles the target of the Federal Reserve. Parsons stated that for the average home, CPI will increase by 1.3% increase by about $ 1,000, and those expenses may increase relatively early in some cases.
“Assuming that these tariffs pass in a month, I will expect prices on grocery items,” Parsons explained. “Some products like avocado, it may probably be a few weeks, perhaps in other cases too soon.”
Trump tariffs warns from business groups
Gas prices may increase if tariffs are imposed on canadian crude oil imports. (Swen Hop / Picture Alliance Getty Image / Getty Image)
Regarding energy prices, Parsons said that their research has shown that gas prices Canadian crude oil can result in an increase of 70 cents as a result of a reduced tariff rate of 10%. He said that vengeance between the US and Canada may increase more than this.
“Since these tariffs are targeting various types of goods, for example, agriculture will have less margins of adjustment, so the consumers will eventually put a burden in this matter.” More price. “
Durante said that America can be seen as a less reliable trading partner in the future, given the tariff threats against Canada and Mexico – the two biggest trading partners of America who are partying. US-Mexico-Canada Agreement (USMCA) that Trump interacted during his first term.
Get Fox Business when you click here
“America also stands to lose further credibility, because when we signed USMCA, a part of it is committed not to implement tariffs in violation of that agreement,” he explained. “So overall, not only our economy will deteriorate due to tariffs, but I think the US will have more difficulty in interacting in future free trade agreements.”
