June 5, 2019
President Trump’s plan to force Mexico to take a tougher approach to enforcement of its border, by ramping up tariffs on its products, will ripple through the United States, with consumers around the country paying more for cars, TVs, bluejeans, beer, fresh vegetables and other products.
For state economies, the impact of these rising prices depends on how reliant their major industries — from automakers to food producers to energy companies — are on suppliers in Mexico.
A 5 percent tariff on all goods coming from Mexico is set to go into effect on Monday, unless officials from the two countries can work out a deal that will satisfy Mr. Trump. On Wednesday, Mexico’s foreign minister met with Vice President Mike Pence and other American officials to discuss solutions to stem the flood of migrants, mostly from Central American countries, that have come over the southwestern border.
Later in the day, Mr. Trump said no deal was reached. He plans to gradually ramp up his tariffs on Mexican goods to 25 percent by October.
That could cause significant pain for American consumers and businesses, even those far from the southwestern border.
As a share of its overall economy, Michigan is actually the state that is most dependent on imports from Mexico, largely because the automobile industry has set up complex North American supply chains that send components and finished products back and forth across the border.
Michigan imported $56 billion of products from Mexico last year, second only to Texas, which thrives on trade in energy, food and manufactured goods with Mexico. California and Illinois, with major population centers that depend on fresh produce and manufactured goods from Mexico, were also among the top importers.
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