February 21, 2025
North America started this month with the announcement of 25% tariffs on U.S. imports from Mexico and Canada, our neighbors and top trade partners. President Trump held separate conversations with President Sheinbaum and Prime Minister Trudeau which resulted in a 30-day pause on the implementation of tariffs. Canada and Mexico agreed on enhanced border security, with Prime Minister Trudeau also appointing a fentanyl czar and listing drug cartels as terrorist organizations. Mexico has since deployed10,000 national guard officers to the northern border and urged President Trump to fulfill U.S. commitments to hinder gun trafficking. The Trump administration did move forward with 10% tariffs on imports from China, which caused retaliation including 10 to 15% tariffs on crude oil, liquefied natural gas, farm machinery, and other products from the U.S. as well as financial sanctions on U.S. companies operating in China. As the U.S. and Mexico’s #3 top trade partner, and with regional integrated supply chains relying on free trade policies, many San Diego businesses of all sizes have been severely impacted by these tariffs.
Just a week later, President Trump announced 25% tariffs on steel and aluminum. Similar tariffs were imposed during the first Trump administration with exemptions offered to commercial allies including Canada and Mexico. No exemptions have been announced so far, with steel and aluminum tariffs scheduled to begin next month. The uncertainty caused by an unstable trade landscape continues to impact our region’s ability to attract investment, fulfill business expansion plans, and boost economic growth.
A greater announcement was made the following week: President Trump signed a memorandum asking Department of Commerce nominee, Howard Lutnick, and his Global Trade Representative Jamieson Greer, to prepare a country-by-country report outlining actions that ensure reciprocal trade relationships. This would likely translate into general, reciprocal tariffs impacting a wide variety of raw materials and industries, as well as potential retaliation from other countries.
The Chamber has elevated our business community’s concerns about the detrimental effects that tariffs would have on our region’s economy and community. Expert reports estimate up to $7,600 in additional annual costs per U.S. household should tariffs be implemented indefinitely. Interim President and CEO Jessica Anderson has been at the forefront of regional efforts, hearing from businesses across industries and voicing concerns as a unified community. The Chamber was one of the first organizations nationwide that proactively spoke against tariffs gaining media coverage that also caught the attention of President Sheinbaum, who included our statement in a compilation of press releases and statements in support of trade and collaboration within North America.
In her role as Vice Chair of the U.S. Border Trade Alliance, VP of International and Public Affairs Kenia Zamarripa gave a presentation at this month’s Border Trade Alliance Mexico’s board meeting to share advocacy efforts against tariffs and in support of USMCA and actions to facilitate trade and travel within North America. BTA Mexico will travel to our region in March to continue conversations to strengthen collaboration amongst businesses leaders from both countries to ensure that the border continues to be an economic engine which enables bilateral, co-producing supply chains that make our region globally competitive and boost economic growth on both sides of the border.
As stated in last month’s policy update, the Chamber strives to enhance our region’s economy through efficient cross-border trade and strong international collaboration and partnerships. We remain committed to leading advocacy and policy efforts that have been key for our business community to thrive and for CaliBaja to become a model for prosperity in a globalized economy. Ready to engage in advocacy efforts? Join us on this year’s binational delegation to Washington D.C. from April 6-9. Registration and details are available here.