By Daily Mail (U.S.) | Created at 2024-11-26 20:51:54 | Updated at 2024-11-29 10:44:42
2 days ago
Economists and consumer experts have warned which products are likely to become more expensive under Donald Trump's new trade tariff proposals.
The President-elect has promised to bring in a host of new tariffs on foreign imports on day one of his presidency.
Trump yesterday vowed to use executive orders to implement an additional 10 percent tariff on Chinese goods on top of existing levies.
He also threatened tariffs of 25 percent on America's two largest trading partners, Mexico and Canada.
More than $1.3 trillion-worth of goods were imported in to America from the three countries last year, according to US Census Bureau data.
That means goods ranging from cars, gas, smartphones and appliances to pharmaceuticals and apparel could go up in price, experts have warned.
'Tariffs will push up costs for American companies and those costs will eventually find their way through to higher prices for shoppers,' retail expert Neil Saunders told DailyMail.com.
'If tariffs are broad brush, then there will be an impact on a wide range of categories. However, ones that will feel the biggest pinch include appliances, furnishings, and apparel,' Saunders, of GlobalData, explained.
Donald Trump has vowed to impose strict sanctions on China, Mexico and Canada
Mexico is the US's biggest trading partner, with $475 billion in goods being imported from the country last year, The Washington Post reported.
The majority of these imports were manufactured items such as cars, computers and household appliances, which could go up in price under the proposed tariffs.
A tariff with Canada as America's second largest trading partner would also have widespread impacts.
The US imported more than $418 billion in goods, including crude oil and machinery such as turbines and engines, from Canada last year alone.
The US also imports billions in plastics, pharmaceuticals, metals and agricultural products from their northern neighbor every year.
These items could also see prices hiked if Trump follows through on these plans.
Canada and Mexico are also major suppliers of vehicles and parts, and many cars sold in the US are assembled in those countries or use components sourced from them, according to Newsweek.
Analysts have estimated that a tariff could add $1,000 to $5,000 to the price of a new car, with parts such as engines and tires becoming more expensive.
Canada and Mexico are also significant exporters of agricultural goods to the US.
Potential tariffs could make everyday food items such as fruit, vegetables, meat and dairy more expensive, the outlet reported.
China has been a target for Trump's tariffs as he seeks to protect that domestic vehicle and other manufacturing industries from cheaper Chinese imports.
Last year the US imported almost $427 billion in goods from China and exported almost $148 billion, making it its third largest trading partner in the world.
The top goods the US imported from China last year were electronics, including phones, computers, toys, games, sporting equipment, furniture and plastics, according to The Washington Post.
It also imports billions in a wide variety of items such as clothes and shoes, medical equipment, chemicals and pharmaceuticals, the outlet reported, which could also increase in price.
Potential tariffs could make everyday food items such as fruit, vegetables, meat and dairy more expensive
Chinese electric vehicles have been a battleground for tariffs for some time
The US imports billions in agricultural products from their northern neighbor every year
The US also imports billions in plastics, pharmaceuticals, metals and agricultural products from their northern neighbor every year (Pictured: A shopper in a drugstore)
'Tariffs will push up costs for American companies and those costs will eventually find their way through to higher prices for shoppers,' retail expert Neil Saunders told DailyMail.com
Trump made the trade threats on his Truth Social platform, claiming tariffs would be used to stop the flow of drugs and immigrants into the United States.
'This Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!' he said of Mexico and Canada.
He also posted that he had 'many talks with China about the massive amounts of drugs, in particular Fentanyl, being sent into the United States – But to no avail.'
Trump has continued to discuss different numbers for tariffs throughout his presidential campaign and since his victory in the election.
During his campaign, he proposed a tariff upward of 60 percent on all Chinese goods, alongside an across-the-board levy on all other imports into the country.
It is not known which of his proposals may actually be enacted in January.
But before this latest promise, economists at ING had argued Americans would be out a of pocket a further $2,400 each every year.
With further tariffs suggested on Mexican and Canadian imports as well as Chinese imports, this figure is likely to be even larger.
'This potential increase in consumer costs and inflation could have widespread economic implications, particularly in an economy where consumer spending accounts for 70 percent of all activity,' economists Inga Fechner and James Knightly wrote in their report.
Saunders, from GlobalData, added that retailers may be able to adapt to tariffs - if such proposals are actually implemented.
'Over time, retailers and manufacturers will shift where they make things – but making these changes can't be done overnight,' he told DailyMail.com.
'The one point that needs to be remembered is that President Trump uses the threat of tariffs as a negotiating tactic.
'So, there is no guarantee that long-term tariff policy will be as harsh as the rhetoric. Even so, retailers need to prepare for the worst.'
