President Donald J. Trump has implemented extensive tariffs on foreign trade. Using his authority under the International Emergency Economic Powers Act of 1977 (IEEPA), he will impose a 10% tariff on all countries, effective April 5, 2025, at 12:01 a.m. EDT. Additionally, an individualized reciprocal higher tariff will be applied to countries with which the United States has the largest trade deficits. All other countries will continue to be subject to the original 10% tariff. This measure will take effect on April 9, 2025, at 12:01 a.m. EDT.
For Canada and Mexico, the current IEEPA orders related to fentanyl and migration remain in effect and are not impacted by this new order. This means that goods compliant with the United States- Mexico- Canada Agreement (USMCA) will continue to have a 0% tariff. In contrast, goods that are not USMCA compliant will face a 25% tariff, while non-USMCA compliant energy and potash will be subject to a 10% tariff. If the existing fentanyl and migration IEEPA orders are terminated, USMCA compliant goods would still receive preferential treatment, but non-USMCA compliant goods would then be subject to a 12% reciprocal tariff.
Why the Tariffs?
The White House argues that these tariffs are necessary to protect American workers and rebuild the nation’s manufacturing base, which they claim has been hollowed out by unfair trade practices. They cite large and persistent trade deficits, particularly with countries like Mexico, as evidence of non-reciprocal trade relationships that undermine U.S. economic and national security. The administration emphasizes the need to level the playing field, pointing to instances where other countries impose significantly higher tariffs on U.S. goods than the U.S. does on theirs. They also highlight the impact of non-tariff barriers, such as complex regulations and testing requirements, which they say hinder American businesses’ access to foreign markets.
President Trump’s administration asserts that these tariffs are not only justified but also effective. They point to studies suggesting that tariffs can stimulate domestic production, reduce imports, and have minimal impact on consumer prices. The administration also argues that tariffs provide an incentive for foreign trading partners to align with the U.S. on economic and national security matters, and offer a way to rebalance trade relationships. They reinforce that the tariffs are designed to ensure reciprocity, reflecting a “Golden Rule” approach to international trade, where the U.S. demands to be treated as it treats other nations.
Fresh Produce Industry Voice Over New Tariffs
International Fresh Produce Association (IFPA) CEO Cathy Burns issued the following statement:
“IFPA appreciates the administration’s decision to allow continued trade of fresh produce and florals covered under the U.S.-Mexico-Canada Agreement (USMCA).
“Fresh fruits, vegetables, and florals are among the most highly traded commodities across North America and beyond. Reducing trade barriers ensures that consumers continue to have access to fresh, affordable produce and floral products while supporting the growers and businesses that sustain the industry.
Related Article: Decoding Tariffs: IFPA’s Essential Resources
“However, IFPA remains concerned about the broader application of tariffs on global trading partners and the resulting disruptions to supply chains, market stability, and food prices worldwide. The global trade of fresh produce is essential to the health and well-being of people in every nation. Targeted use of tariffs can be a tool for addressing inequities between trading partners, but broad application of this blunt tool often disrupts markets, raises consumer costs, and places unnecessary strain on growers and producers across the supply chain.
“Fresh produce trade is uniquely complex, shaped by seasonal and regional factors that require a well-functioning market for year-round availability. Once businesses lose market share, reclaiming it is difficult—if not impossible—dealing a lasting blow to an industry vital to food security and economic stability.
“We appreciate the administration’s commitment to easing regulatory burdens and supporting American agriculture. We urge continued efforts toward long-term solutions that benefit fresh produce growers and businesses, including equitable trade agreements, regulatory reform, and policies that promote a stable agricultural workforce.
“IFPA looks forward to working with the administration on balanced solutions that protect growers, businesses, and consumers alike.”