Advocacy News – Feb. 5, 2025
What’s new: Both sets of North American tariffs were postponed from taking effect Monday, after Presidents from the countries come to an agreement that will stave off their implementation for 30 days. Tariffs on Mexican and Canadian imports were held off until March after President Donald Trump, Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum struck deals involving sending 10,000 Mexican troops to the U.S. border and the implementation of a $1.3 billion Canadian border plan.
Why it Matters: The stated intent of the 25 percent blanket tariffs by the White House is to initiate actions on both the north and south U.S. borders to curb the traffic of illegal drugs, particularly fentanyl, and work towards a trade relationship that puts greater focus on domestic manufacturing.
- The only partial exemption to the universal tariff rates was a 10% rate on Canadian energy products.
What does it mean for Michigan: Critics state that tariffs will hurt American businesses and consumers, with some underscoring that Michigan may be disproportionately impacted, given its exposure to the strong and wide-ranging trade relationship with Canada, with particular focus on automotive, agriculture and energy.
- Canada is Michigan’s largest international trade partner, annually importing over $50 billion in goods from Canada and exporting $27.5 billion in goods to Canada. Michigan exports nearly $3 billion in agricultural and food products annually, with the majority being sent to Canada. The U.S. is also a significant importer of a number of commodities from Mexico, from automotive parts to medical supplies.
The bottom line: The legal underpinning for these tariffs is based on the President’s power to declare a national emergency under the International Emergency Economic Powers Act (IEEPA), 50 U.S.C. §1701 et sec, which gives broad powers to the President to declare a national emergency and take remedial action. President Trump also cited authority for the executive orders under the National Emergencies Act, (NEA), which gives Congress the ability to review and reverse a declaration of national emergency.
What we are saying: The MI Chamber continues to monitor the situation and engage with Federal decision makers regarding concerns of potential impacts to Michigan businesses and consumers.
We want to hear from you! Could your business potentially be impacted by tariffs? Complete the survey to assist with Chamber engagement as the situation continues to unfold.
- Your voice is critical in helping the MI Chamber be a voice of free enterprise and economic prosperity for the state.