US President Donald Trump’s decision to impose 25% tariffs on imports from Mexico and Canada has created uncertainty in the US economy and international trade.

Andrés Franco, general director of the Mexican Business Council for Foreign Trade, Investment and Technology (Comce) Northeast , explained the immediate and long-term effects that these measures could have on both countries.

He said that during his term in office, Trump has signed 82 presidential orders , 23 of which affect foreign trade.

In this regard, since the implementation of the tariffs, there has been a drop in the US consumer confidence index , suggesting a widespread fear of the increase in the costs of essential products. Companies such as Target and Best Buy have already warned that their prices will rise due to the higher cost of imported goods from Mexico and Canada.

The executive pointed out that products such as vehicles, auto parts, avocados , among others,   will be the most affected.

According to Comce Noreste, an average family in the United States could see an annual increase of up to three thousand dollars in their spending on food and appliances.

In the case of the automotive industry, a vehicle manufactured in Mexico and sold in Texas could increase its price from $36,000 to $42,000 due to the new tariffs.

“American consumers will feel these increases in their daily lives. A car assembled in Mexico could cost up to $6,000, and gasoline imported from Canada would cost between 20 and 40 cents more per gallon,” Franco explained.

He also noted that the impact on financial markets was not long in coming, with the US stock market falling by 2.4% after the tariffs came into effect.

At the border, uncertainty led companies to advance exports before the deadline , so at the Nuevo Laredo customs there were lines of up to 14 kilometers of trucks seeking to cross before the application of tariffs, however, after their implementation, many exporters suspended shipments awaiting possible changes in trade policy.

“We saw lines of up to 14 kilometers at the Nuevo Laredo customs in the previous weeks, with companies trying to get ahead of the tariffs coming into effect. Yesterday, after the announcement, many suspended exports awaiting clarity on the measure,” Franco explained.

Example of an affected import

To better understand the impact of tariffs, Armando Guerra, director of Commercial Intelligence, presented a practical case on the import of computers from Mexico to the United States.

Assuming that a Mexican company sends a truck full of computers with an invoice value of $100,000 to Houston, Texas , the cost of transportation and insurance to customs in Laredo, Texas, is $5,000, and the cost from Laredo to Houston is $3,000.

Prior to the imposition of tariffs, these computers entered the country without paying taxes thanks to the United States-Mexico-Canada Agreement (T-MEC), however, with Trump’s new executive order, the tariff is calculated on the customs value (that is, the value of the merchandise plus the transportation costs to customs).

“The 25% tariff is calculated on 105 thousand dollars (100 thousand of invoice value plus five thousand of transport to customs), which is equivalent to an additional payment of 26 thousand 250 dollars,” explained Guerra.

In some cases, if the merchandise contains inputs originating in the United States, these may be excluded from the calculation of the tariff.

For example, if $20,000 of the $100,000 corresponds to components manufactured in the neighboring country, the tax would apply only to the remaining $80,000, however, this requires additional procedures to prove the origin of the inputs.

“This increase directly affects Mexico’s competitiveness, since other countries such as Korea or Japan will continue to export computers to the United States without tariffs, which could displace Mexican companies from the market,” Guerra warned.

Strategies and alternatives for Mexico

Faced with this situation, businessmen and analysts have begun to explore strategies to mitigate the impact. One option is lobbying with the most affected states , mainly Texas, which receives 30% of Mexican imports.

“It is not just a commercial issue, but a political one. The strategy will be to work with the Republican states most affected so that they themselves exert pressure in Washington. If the American consumer begins to feel the effects, there may be changes in the tariff policy,” Franco explained.

Another alternative is to diversify markets .

Currently, 83% of Mexican exports are destined for the United States, making Mexico highly vulnerable to this type of measures, but the country has 14 free trade agreements with 50 nations, which opens the possibility of expanding exports to other markets, such as Europe and South America.

“Mexican companies are already exporting to more than 15 or 20 countries in Latin America and Europe. With the right analysis, we can identify which countries have specific demand for our products and develop new commercial strategies,” Guerra said.

Meanwhile, the Mexican export sector remains on alert, monitoring the evolution of the trade balance and the impact on supply chains.

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MONTERREY, NL.- More than 20 years have passed since the Customs-Trade Partnership Against Terrorism (CTPAT) program was created after the September 11, 2001 attacks in the United States, and at least 3,500 Mexican companies have been certified under this initiative.

Christian Cantú González, Commercial Director of the Mexican Business Council for Foreign Trade, Investment and Technology (Comce) Norest e , mentioned during his participation in the Supply Chain Security Day that during the growth of the program its standards were strengthened and changes were made to it after almost 20 years of its beginning, “so it was more than necessary to update it with current risks.”

However, they were carried out during the pandemic and had a negative impact on the dissemination and clarification of information with specialists.

“Although in our case we tried to disseminate it through videoconferences, its update was very important, but the important thing is that, according to our calculations, there would only be three thousand or three thousand five hundred certified Mexican companies, including transporters, transfer companies, importers and exporters, and of those, we have achieved in 22 years, a higher level that we have audited, and what I would put on the table is to extend the review to foreign companies and for them to enjoy some additional benefits such as greater streamlining and reviews, and generate a higher level of trust,” he said.

Juan Gallardo, Supply Chain Security Specialist from the CTPAT Field Office in Miami, commented in the Panel Discussion: A talk with the young CTPAT in Mexico , that efforts have been made to implement this type of actions for five years .

Victor Daniel Chavez, executive director of the International Trade Security Cluster , said that there are no logistics operators in the country within the program and “it is because they do not want to touch the cargo or I have nothing to do with it.”

Beginnings

Juan Gallardo recalled that he began working at the CTPAT two years after the program began. He recalled that its initial implementation was difficult due to barriers such as language, communication, and the application of criteria in different institutions.

“There are several changes, starting with CTPAT, which for me is a tool for border officials, since when analyzing the manifests, they find that they belong to this program and the process is easier. Between 50% and 80% of the daily merchandise is entered by the members, and the officials can focus on other things. Initially it was very difficult with companies or trade, but also with the different customs departments,” he said.

Christian Cantú González recalled that in 2003 the BASC (Business Anti-Smuggling Coalition) program certification for logistics security was already in place .

“There were several things that are different today thanks to technology and the CTPAT portal and its updates. At first, there was a boom from 2003 to 2010, and in retrospect, I have seen companies that after four or five years have a relaxation, especially due to the time that passes for revalidation, which can take three or four years,” he explained.

For this reason, he mentioned that as an organization they support companies to maintain their processes with or without a visit from the CTPAT . We do not do the work for them but rather we teach them to do it because they are the ones who carry out the operation on a daily basis.

For his part, Raúl Gilberto López Santana, Senior Security Manager at Carrier LATAM , agreed on the difficulty in starting this program: “It was complicated for the North American authorities to begin to think of a mechanism, to lay the foundations, to shield or prevent what came from abroad.”

“I remember that there were meetings with American authorities and on one occasion when I was in a meeting I saw how the Mexican authorities went to the Navy and so the Mexicans began to get involved in this area to exchange ideas and lay those foundations,” he explained.

He considered that the future of CTPAT lies in private initiatives in the sense of technological innovation for prevention in order to identify threats that may attack.

Juan Gallardo mentioned that after Covid, validations are changed every year , some of them are done virtually, as well as with members and associations to share information, more work with foreign customs to have a mutual recognition agreement, among other actions.

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