The Prime Minister of Canada and the Presidenta of Mexico have called for discussions following statements by the President-elect Donald J. Trump that his incoming Administration would impose 25 percent tariffs on goods imported from both nations that are Canada and Mexico, co-signatories to the USMCA.

An informal meeting recently took place between Justin Trudeau of Canada and the President-elect in Florida.  Dr. Claudia Sheinbaum of Mexico has warned of a mutually destructive trade war, inflation and other undesirable outcomes of a unilateral imposition of tariffs by the U.S.  Presidenta Sheinbaum has called for trilateral discussions to resolve trade issues.

Currently the U.S. imports live cattle from Mexico and has exported year to date 173,000 metric tons of beef and 850,000 metric tons of pork, respectively higher by 13 percent and 7 percent over the corresponding ten months of 2023.

The threat of high tariffs is regarded as an opening salvo for subsequent negotiations.  Major issues in contention include illegal entry into the U.S. across the southern border from Mexico by economic refugees from Central America.  The peripheral issue of smuggling of drugs does not directly relate to immigrants but is a function of interaction between cartels in Mexico and their compatriots in the U.S. some of whom are U.S. citizens

It is a reality that the manufacturing, agricultural and economic structures of the USMCA partners are intertwined, and that imposition of broad punitive tariffs would have unexpected and undesirable consequences including inflation with U.S. consumers ultimately footing the bill.