Here’s an assessment of how much the new tariffs proposed by Trump (25% on Mexico and Canada and 10% on China) would affect cross-border trade with those three countries, and how much in USD Trump would gain from that if symmetric tariffs were imposed by all three countries.
Overview of U.S. cross-border trade with Canada in absolute figures and as a percentage of total U.S. trade with foreign countries, based on recent data (2022–2023):
U.S.-Canada Trade Overview (2022–2023)
1. Total Trade Volume (Goods and Services)
— 2022 : $793.4 billion
— U.S. exports to Canada: $356.1 billion
— U.S. imports from Canada: $437.3 billion
— 2023 (estimated) : ~$800 billion (slight growth YoY)
2. Trade Balance
— 2022 : U.S. trade deficit with Canada: $81.2 billion
— 2023 (estimated) : Deficit remains stable, around $80 billion.
3. Percentage of Total U.S. Trade
— 2022 : Canada accounted for 14.5% of total U.S. trade (exports + imports).
— U.S. exports to Canada: 17.5% of total U.S. exports.
— U.S. imports from Canada: 12.8% of total U.S. imports.
Key Trade Items (2022)
U.S. Exports to Canada (Top Categories)
— Machinery and Vehicles : $63.4 billion (17.8% of exports to Canada)
— Electrical Machinery : $44.2 billion (12.4%)
— Mineral Fuels (e.g., oil, gas) : $33.1 billion (9.3%)
— Plastics and Chemicals : $28.7 billion (8.1%)
— Agricultural Products : $25.4 billion (7.1%)
U.S. Imports from Canada (Top Categories)
— Mineral Fuels (e.g., crude oil, natural gas) : $100.2 billion (22.9% of imports from Canada)
— Vehicles and Parts : $72.5 billion (16.6%)
— Machinery and Equipment : $45.3 billion (10.4%)
— Plastics and Chemicals : $32.1 billion (7.3%)
— Agricultural Products : $26.8 billion (6.1%)
Trade in Services (2022)
— U.S. Exports to Canada : $63.2 billion (e.g., travel, financial services, intellectual property)
— U.S. Imports from Canada : $35.4 billion
— Trade Surplus in Services : $27.8 billion
Canada’s Position in U.S. Trade
— Largest Trading Partner : Canada is the 1 trading partner for the U.S., surpassing China and Mexico in total trade volume.
— Energy Trade : Canada supplies 25% of U.S. oil imports and is a critical partner in energy security.
— Supply Chain Integration : Deep integration in automotive, manufacturing, and agriculture sectors.
Summary
- Absolute Trade (2022) : $793.4 billion
- Percentage of Total U.S. Trade : 14.5%
- Key Items : Energy, vehicles, machinery, agriculture, and services.
- Trade Balance : U.S. runs a deficit, prim
Here’s an overview of U.S. cross-border trade with Mexico and China in absolute figures and as a percentage of total U.S. trade with foreign countries, based on recent data (2022–2023):
U.S.-Mexico Trade Overview (2022–2023)
1. Total Trade Volume (Goods and Services)
— 2022 : $779.1 billion
— U.S. exports to Mexico: $324.3 billion
— U.S. imports from Mexico: $454.8 billion
— 2023 (estimated) : ~$800 billion (slight growth YoY)
2. Trade Balance
— 2022 : U.S. trade deficit with Mexico: $130.5 billion
— 2023 (estimated) : Deficit remains stable, around $130 billion.
3. Percentage of Total U.S. Trade
— 2022 : Mexico accounted for 14.2% of total U.S. trade (exports + imports).
— U.S. exports to Mexico: 15.9% of total U.S. exports.
— U.S. imports from Mexico: 13.3% of total U.S. imports.
Key Trade Items (2022)
U.S. Exports to Mexico (Top Categories)
— Machinery and Vehicles : $93.2 billion (28.7% of exports to Mexico)
— Electrical Machinery : $57.4 billion (17.7%)
— Mineral Fuels (e.g., oil, gas) : $28.1 billion (8.7%)
— Plastics and Chemicals : $24.3 billion (7.5%)
— Agricultural Products : $19.8 billion (6.1%)
U.S. Imports from Mexico (Top Categories)
— Vehicles and Parts : $109.5 billion (24.1% of imports from Mexico)
— Electrical Machinery : $88.3 billion (19.4%)
— Machinery and Equipment : $63.2 billion (13.9%)
— Agricultural Products : $27.1 billion (6.0%)
— Mineral Fuels : $14.5 billion (3.2%)
Trade in Services (2022)
— U.S. Exports to Mexico : $42.1 billion (e.g., travel, financial services, intellectual property)
— U.S. Imports from Mexico : $18.3 billion
— Trade Surplus in Services : $23.8 billion
Mexico’s Position in U.S. Trade
— 2 Trading Partner : Mexico is the second-largest trading partner for the U.S., after Canada.
— Manufacturing Hub : Critical for automotive, electronics, and machinery supply chains.
— Agricultural Trade : Major supplier of fruits, vegetables, and beverages.
U.S.-China Trade Overview (2022–2023)
1. Total Trade Volume (Goods and Services)
— 2022 : $690.6 billion
— U.S. exports to China: $153.8 billion
— U.S. imports from China: $536.8 billion
— 2023 (estimated) : ~$700 billion (slight growth YoY)
2. Trade Balance
— 2022 : U.S. trade deficit with China: $383.0 billion
— 2023 (estimated) : Deficit remains stable, around $380 billion.
3. Percentage of Total U.S. Trade
— 2022 : China accounted for 12.6% of total U.S. trade (exports + imports).
— U.S. exports to China: 7.5% of total U.S. exports.
— U.S. imports from China: 15.7% of total U.S. imports.
Key Trade Items (2022)
U.S. Exports to China (Top Categories)
— Agricultural Products : $36.4 billion (23.7% of exports to China)
— Machinery and Vehicles : $28.1 billion (18.3%)
— Electrical Machinery : $18.7 billion (12.2%)
— Aircraft and Parts : $15.2 billion (9.9%)
— Chemicals : $12.5 billion (8.1%)
U.S. Imports from China (Top Categories)
— Electrical Machinery : $196.5 billion (36.6% of imports from China)
— Machinery and Equipment : $123.4 billion (23.0%)
— Toys, Games, and Sporting Goods : $38.2 billion (7.1%)
— Furniture and Bedding : $29.8 billion (5.6%)
— Apparel and Textiles : $27.1 billion (5.0%)
Trade in Services (2022)
— U.S. Exports to China : $42.5 billion (e.g., travel, financial services, intellectual property)
— U.S. Imports from China : $16.8 billion
— Trade Surplus in Services : $25.7 billion
China’s Position in U.S. Trade
— 3 Trading Partner : China is the third-largest trading partner for the U.S., after Canada and Mexico.
— Manufacturing Giant : Dominates electronics, machinery, and consumer goods imports.
— Agricultural Exports : Major market for U.S. soybeans, pork, and other agricultural products.
Summary
Mexico (2022) :
— Absolute Trade : $779.1 billion
— Percentage of Total U.S. Trade : 14.2%
— Key Items : Vehicles, machinery, electronics, and agriculture.
— Trade Balance : U.S. runs a significant deficit.
China (2022) :
— Absolute Trade : $690.6 billion
— Percentage of Total U.S. Trade : 12.6%
— Key Items : Electronics, machinery, and agricultural products.
— Trade Balance : U.S. runs a large deficit
To assess the potential impact of new Trump tariffs (25% on Mexico and Canada, 10% on China) on U.S. cross-border trade, we need to consider:
1. Reduction in Trade Volume : Tariffs typically reduce trade volume due to higher costs for importers and exporters.
2. Tariff Revenue for the U.S. : The U.S. would collect revenue from tariffs imposed on imports.
3. Symmetrical Tariffs : If Mexico, Canada, and China impose similar tariffs on U.S. exports, U.S. exporters would face higher costs, potentially reducing exports.
Assumptions
- Elasticity of Trade : Studies suggest that a 10% tariff can reduce trade volume by 5–10% , depending on the product category and market conditions.
- Symmetrical Tariffs : All three countries impose equivalent tariffs on U.S. exports.
- 2022 Trade Data : Used as the baseline for calculations.
Estimated Impact on Trade Volume
1. Mexico (25% Tariff)
— 2022 Trade Volume : $779.1 billion
— Estimated Reduction in Trade : 12.5–25% (midpoint: 18.75% )
— Reduced Trade Volume : $779.1 billion × 18.75% = $146.1 billion
— Remaining Trade Volume : $779.1 billion — $146.1 billion = $633.0 billion
2. Canada (25% Tariff)
— 2022 Trade Volume : $793.4 billion
— Estimated Reduction in Trade : 12.5–25% (midpoint: 18.75% )
— Reduced Trade Volume : $793.4 billion × 18.75% = $148.8 billion
— Remaining Trade Volume : $793.4 billion — $148.8 billion = $644.6 billion
3. China (10% Tariff)
— 2022 Trade Volume : $690.6 billion
— Estimated Reduction in Trade : 5–10% (midpoint: 7.5% )
— Reduced Trade Volume : $690.6 billion × 7.5% = $51.8 billion
— Remaining Trade Volume : $690.6 billion — $51.8 billion = $638.8 billion
Estimated Tariff Revenue for the U.S.
1. Mexico (25% Tariff)
— U.S. Imports from Mexico (2022) : $454.8 billion
— Tariff Revenue : $454.8 billion × 25% = $113.7 billion
2. Canada (25% Tariff)
— U.S. Imports from Canada (2022) : $437.3 billion
— Tariff Revenue : $437.3 billion × 25% = $109.3 billion
3. China (10% Tariff)
— U.S. Imports from China (2022) : $536.8 billion
— Tariff Revenue : $536.8 billion × 10% = $53.7 billion
Total Tariff Revenue for the U.S. : $113.7 + $109.3 + $53.7 = $276.7 billion
Impact of Symmetrical Tariffs on U.S. Exports
If Mexico, Canada, and China impose equivalent tariffs on U.S. exports:
1. Mexico (25% Tariff on U.S. Exports)
— U.S. Exports to Mexico (2022) : $324.3 billion
— Estimated Reduction in Exports : 18.75%
— Reduced Exports : $324.3 billion × 18.75% = $60.8 billion
2. Canada (25% Tariff on U.S. Exports)
— U.S. Exports to Canada (2022) : $356.1 billion
— Estimated Reduction in Exports : 18.75%
— Reduced Exports : $356.1 billion × 18.75% = $66.8 billion
3. China (10% Tariff on U.S. Exports)
— U.S. Exports to China (2022) : $153.8 billion
— Estimated Reduction in Exports : 7.5%
— Reduced Exports : $153.8 billion × 7.5% = $11.5 billion
Total Reduction in U.S. Exports : $60.8 + $66.8 + $11.5 = $139.1 billion
Net Impact on the U.S. Economy
- Tariff Revenue Gain : $276.7 billion
- Export Loss Due to Symmetrical Tariffs : $139.1 billion
- Net Gain for the U.S. : $276.7 billion — $139.1 billion = $137.6 billion
Summary
Reduction in Trade Volume :
— Mexico: 18.75% ($146.1 billion)
— Canada: 18.75% ($148.8 billion)
— China: 7.5% ($51.8 billion)
U.S. Tariff Revenue : $276.7 billion
U.S. Export Loss : $139.1 billion
Net Gain for the U.S. : $137.6 billion
This analysis assumes no retaliatory measures beyond symmetrical tariffs and no significant shifts in supply chains or consumer behavior. Real-world impacts could vary based on market adjustments and policy responses.