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Avocados, cars, will be more expensive if Trump puts tariffs on Mexico



In a Thursday tweet, President Donald Trump announced he would be slapping Mexico with a new round of tariffs on imports of Mexican goods in an effort to punish the country over illegal immigration.

“On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP,” Trump wrote.

In a follow-up statement, the White House announced that the tariffs would escalate to 25% by September if illegal immigration did not decrease. Despite the Trump administration’s efforts to reduce rates of illegal border crossings and discourage potential asylum seekers, an estimated 100,000 people were apprehended at the border last month.

Read more: Trump says he’ll slap a 5% tariff on all Mexican goods to stop the influx of migrants at the US-Mexico border

The announcement of new tariffs comes less than a year after the US struck a deal with Mexico and Canada to revise NAFTA and come up with a new trade agreement, the USMCA.

As the US feuds with China over trade issues, Mexico is quickly becoming one of the United States’ most important trading partners, with 80% of their total exports going to the United States.

Last year, the US imported $346 billion of Mexican goods, an increase of 66% since 2008, according to the White House’s office of the US Trade Representative.

The threat of new tariffs sent shockwaves through the business world and the markets, with the Mexican peso sharply dropping in value after Trump’s announcement.

Read more: The Mexican peso is getting clobbered after Trump threatens to hit Mexican goods with tariffs

While the US imports more agricultural products — such as avocados — from Mexico than any other of its trading partners, an analysis from the Washington Post found that cars, car parts, and other manufacturing inputs make up the bulk of affected imports.

Multiple economics and analysts have already predicted much of the cost of these new tariffs would be directly passed on to US consumers, and likely end up harming the US and the global economy more than successfully punishing Mexico.

Here’s a look at which consumer goods make up the majority of US imports from Mexico and will be the most affected by new tariffs, based on 2018 trade data from the US Trade Representative:

  • Together, electrical and other types of machinery made up $127 billion worth of the US’ imports from Mexico.
  • The new tariffs will impact $93 billion worth of vehicle imports.
  • $16 billion worth of mineral fuel imports will be affected.
  • The tariffs will also affect the US medical industry, as America imported $15 billion worth of medical devices and instruments from Mexico in 2018.
  • The tariffs will likely raise the price of groceries for American consumers, since the US imported $26 billion of Mexican agricultural goods last year.
  • The prices of $11.7 billion worth of fresh fruit and vegetable imports, $3.6 billion worth of alcohol, and $3.9 billion of processed foods and snacks will go up as a result of the new tariffs.
  • Last year, the US imported $1.7 billion worth of avocados from Mexico, $2.3 billion worth of tomatoes, $3.5 billion worth of beer, and $1.6 billion worth of hard alcohol including tequila, according to an analysis from CBS.

Read more:

Trump’s latest trade-war grenade has the global economy heading toward a scenario where no one wins

Global markets plunge as China trade war and Mexico tariffs fuel a ‘triple hit of bad news’

Trump’s new Mexico tariffs threaten to derail a major trade agreement that took more than a year of bitter negotiation, and they’re even drawing the ire of a Republican ally

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