What Trump’s trade war would mean in nine charts

President Donald Trump has threatened to introduce customs duties for Canada, China and Mexico – the United States’ largest trading partners – in February. US importers pay a 25 percent tax on all goods from Canada and Mexico as Trump tries to force both countries to limit migration and drug trafficking to the United States. Import from China, meanwhile, will have 10 percent tariffs, unless Beijing reins in smuggling fentanyl-Precursor chemicals to Canada and Mexico, where they have been made to the American-bound Fentanyl.

Here are nine graphics that show the potential economic effects of such tariffs in all four countries.

How could tariffs affect the United States?

Nearly half of all US imports – more than $ 1.3 trillion – came from Canada, China and Mexico. However, analysis of Bloomberg Economics shows that the new tariffs could reduce the total US import by 15 percent. While Washington, DC-based tax foundation estimates that the tariffs will generate around $ 100 billion Per year in extra federal tax revenue, they would also introduce significant costs to the wider economy: to disrupt supply chains, raise the cost of businesses, eliminate hundreds of thousands of jobs and ultimately increase consumer prices.

Certain sectors of the US economy would be hit particularly hard, including car, energy and food sectors. Gas prices could rise as much as 50 cents per day. Gallon in the midwest as Canada and Mexico deliver more than 70 percent (Pdf) of import of crude oil into US refineries. Also in danger, cars and other vehicles are as the United States imports almost half of its car parts from its northern and southern neighbors.

A 25 percent duty on Canada and Mexico would raise production costs for us car manufacturers, Adding to $ 3,000 For the price of some of the approx. Sixteen million cars sold in the United States every year. Diet with groceries would also rise as Mexico is the United States’ largest source of fresh products that deliver more than 60 percent of us vegetable imports and almost half of all imports of fruit and nuts.

Still, the United States are less dependent on trade than many other industrialized economies, including Germany, Japan and the United Kingdom. Imports and exports make up only a quarter of us gross domestic product (GDP), and the sources of the United States what it imports from a rather wide set of nations.

How could tariffs affect Canada and Mexico?

The two countries are especially dependent on trade in the United States. More than 80 percent of Mexico’s exports – including cars, machines, fruits, vegetables and medical devices – is north of 15 percent of total US import. This addiction is especially pronounced by Mexico’s northern border. That draws industrial states chihuahua, coahuila, nuevo león and baja california Almost half of Mexico’s exports to the United States, sending more than $ 200 billion value of computers, electronics, transport equipment and other products every year.

A one -sided 25 percent duty on these goods could cut Mexico’s GDP by approx. 16 percent according to Bloomberg Economics, where Mexico’s automotive industry carries brown. Mexico sends almost 80 percent of the cars it produces to the United States alone, corresponding to approx. 2.5 million vehicles each year. Duties would also threaten Mexico’s energy sector; The United States is the recipient of approx. 60 percent of Mexico’s oil exports, most of which are crude oil bound to US refineries. At the same time Mexico is the top destination for us refined oil exports, which meet over 70 percent of domestic demand. US tariffs would make fuel more expensive and raise prices at the pump and exert Mexico’s wider economy.

Canada faces a similar challenge. USAs buy more than 70 percent (Pdf; in Spanish) of Canada’s exports, with these goods that make up 14 percent of the total US import. During the new tariffs, Canada’s energy sector would take the biggest hit as exporters Send 80 percent of their oil south.

These asymmetries in the cost of tariffs at home provide the US’s considerable leverage over its North American partners in the negotiations.

How could tariff rates affect China?

In recent years, US-China Trade has fallenEspecially in sectors affected by previous tariffs and export control, such as car parts, data plants, furniture and semiconductors. China has instead increased trade with other partners, including the European Union, Mexico and Vietnam. The country’s share of global trade is climbed approx. 4 percent since 2016, when President Trump first joined, even as the US share is dipped. Combined, these factors would reduce the shock of another 10 percent duty on Chinese exports to the United States.

What could happen the day after?

Each country’s currency could be further weakened and reduce customs bite on imports and raise the effective price of US exports to other nations. A weakened yuan has already softened battles for Chinese producers, which helps their exports to remain competitive around the world. The approx. 30 percent depreciation of Mexico’s Peso since April and the Canadian dollar fall of 8 percent since September also reduces the potential influence. Markets can potentially operate Peso as well as the Canadian dollar, further down if the customs are put in place.

In addition, Canada, China or Mexico could react kindly and introduce tit-for-tate-duty rates on the United States. Mexican President Claudia Sheinbaum has already suggested that Mexico could be reciprocated with his own tariffs, and the US-Mexico-Canada Agreement (USMCA), which supports North American free trade, would probably allow it.

This would not be the first time the countries have reciprocated. In 2018, Mexico and Canada placed retaliation on a total of more than $ 15 billion value of US goods – including steel, pork, yogurt and tablecloths – after Trump imposed duty on their steel and aluminum. Likewise, the United States lost $ 20 billion in annual agricultural exports when China hit a number of US customs from 2018 to 2019.

Retalatory tariffs in the United States will predominantly affect manufacturing states. Mexico buyer 70 percent (PDF) of New Mexico’s exports, including billions of dollars in US semiconductor chips and electrical components that later return to the United States in Mexican manufactured cars and appliances. Texas sends more than $ 20 billion in chips, car parts and electrical equipment to Mexico; In general, the state’s southbound export accounts for 5 percent of its GDP. Tariffs would also bend Ohio’s $ 5 billion worth of auto and metal exports to Canada as well as Maines $ 320 million in northbound timber and paper exports.

Will Merrow created the graphic for this article.