President Trump plans to levy tariffs on February 1 on three of the country’s leading trading partners—China, Mexico, and Canada.
So far, the plan is to levy 10% levy on imports from China and a 25% levy on imports from Mexico and Canada. The executive action signed on Monday last week directs the Secretaries of Commerce and Treasury, along with the U.S. Trade Representative to investigate the factors contributing to America’s trade deficits with foreign nations along with additional directives.
Before looking at the impact of these tariffs across the countries involved, I wanted to take a closer look at the data which shows where the U.S. stands in terms of trade with these countries.
The data has been.pulled from the U.S. Census and UN Comtrade to compare the trade flow in the U.S. with China, Mexico and Canada through charts.
Mexico, Canada and China are leading U.S. trading partners
The U.S. imports more than 10% of total imports from each of these countries.
Under the United Sates – Mexico – Canada Agreement (USMCA) — formerly known as NAFTA, many goods traded between the U.S., Mexico, and Canada are exempt from tariffs, provided they meet specific rules of origin requirements. USMCA is scheduled for review in 2026, but if the review is expedited to 2025, the tariffs could be avoided by making concessions in the agreement.
(Click below on the tree map to get exact share of imports in the U.S. from a specific country)
However, in 2023, Mexico became the leading exporter to the U.S. surpassing China and making roughly 15% of the total American imports. The U.S. import increased from Canada and soared from Mexico but declined from China, partly due to the tariffs levied in the previous years.
Trade Deficit
A closer breakdown of the data shows that the U.S. runs a trade deficit (more imports than exports) with all the three countries and while for Canada, this deficit margin has decreased, it has only increased with China and Mexico.
As data reveals, the U.S. trade deficits persist with all three countries, despite shifts in import patterns.
Critics warn Trump's tariffs would damage all the economies involved, including the US and lower the GDP for each country involved but advoates say it'll boost domestic revenue.
In the coming months how America's trading partners react/retaliate will actually determine whether these tariffs achieve their intended goals or lead to unintended consequences in the global economic landscape.
Up next: Impact of Trump's tariffs on Mexico, Canada and China