On February 1, Donald Trump reignited global trade tensions by declaring a national emergency in the United States, citing the urgent need to combat illegal immigration and fentanyl trafficking. As part of this measure, he imposed 25% tariffs on products from Mexico and Canada and a 10% tariff on imports from China.

The executive orders state that these tariffs may be lifted if the affected countries implement effective policies to curb migration and drug trafficking. Additionally, no exemptions or exclusion processes are considered for importers, and products will remain subject to these tariffs even if they enter free trade zones in the United States. The U.S. administration also reserves the right to increase or expand these measures in response to retaliatory actions by affected countries.

However, after intense negotiations, Trump announced a temporary 30-day suspension of the additional 25% tariff on products from Mexico and Canada. This decision follows agreements reached with the leaders of both countries.

Agreements with Mexico and Canada:

• Mexico: President Claudia Sheinbaum committed to deploying 10,000 National Guard members at the U.S. border to curb the flow of fentanyl and migrants.
• Canada: Prime Minister Justin Trudeau announced a $1.3 billion border plan, including the addition of 10,000 new agents and the creation of a “Fentanyl Czar” to enhance security.

Key Points:

• The tariffs have not been canceled, only temporarily suspended to allow for bilateral negotiations.

Impact on Importers:

• A possible accumulation of inventories in the next 30 days, which could lead to congestion at U.S. ports.
• Only products meeting certain criteria will be exempt from additional tariffs:

1. 1. Having cleared U.S. customs before the deadline.
   2. Having been loaded or in transit before February 1, 2025, at 12:01 a.m. (Eastern Time).

What’s Next?

Importers and exporters must remain vigilant. Critical deadlines are decisive—if goods do not meet the executive order deadlines, they may face new tariffs. It is recommended to closely monitor updates and consider contingency plans.

China:

• The 10% tariff on Chinese imports remains in effect and takes effect today, February 4, 2025.
• In retaliation, China announced today, February 4, new tariffs on certain U.S. imports, including crude oil, agricultural machinery, and liquefied natural gas. These measures will take effect on February 10.
• Additionally, China announced the launch of an investigation into Google for alleged violations of its antitrust laws. The company, whose search engine is not available in China, has minimal operations in the country.

At Calderón Marín, we are committed to providing comprehensive and personalized advisory services on tax and international trade matters. If you need support or wish to obtain more information about these tariff changes, please do not hesitate to contact us, we will be happy to assist you.