Donald Trump’s imposition of tariffs on imported goods from any country marks a return to more aggressive protectionism and a deliberate weakening of the multilateral system established after World War II. These tariffs, affecting most U.S. trading partners, usher in a new era of economic uncertainty and geopolitical tension.
The global economic order based on free trade principles and multilateral dispute resolution is being directly challenged by Trump’s policies. The World Trade Organization (WTO), already weakened by U.S. inaction and boycott of its appeals body, will become irrelevant. Unilaterally imposing taxes on allied nations erodes decades of trust and cooperation.
Impact on North America
In North America, the effects are immediate: The T-MEC proposed by Trump during his first term is jeopardized. Both Mexico and Canada have warned that these measures violate the treaty and prepare legal and commercial responses. President Claudia Sheinbaum’s government has maintained a firm but prudent stance. Retaliation will be inevitable if the U.S. continues to use tariffs as a political pressure tool.
Economic Costs
The economic costs are already evident: In the U.S., sectors like automotive, manufacturing, and agriculture face increased costs and export market restrictions. The average price of new cars could rise by over $6,000. Exporting farmers, particularly those relying on China and Mexico, will see reduced demand for their products, affecting business profitability and rural employment.
Mexico’s Vulnerability
Mexico is especially vulnerable as 83% of its exports go to the U.S. The 25% tariff will impact investments, jobs, and fiscal revenues in our country. In response, the government aims to accelerate market diversification by strengthening its presence in Europe through the updated Global Modernized Agreement with the EU and expanding participation in Asia-Pacific trade mechanisms, especially with China and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
International Geopolitical Effects
Internationally, the effects go beyond economics. Canada is accelerating ties with Europe, China positions itself as a strategic alternative, and Asia-Pacific countries explore new alliances. This fragmentation weakens U.S. global influence and speeds up a realignment of trade that favors the EU and China.
Precedent and Concerns
Trump’s unilateral trade policy sets a worrying precedent. Using tariffs as a political pressure tool undermines trust among partners, raises product costs, disrupts supply chains, and encourages similar responses in other regions. Economic nationalism, far from offering stability, introduces rigidity, fragmentation, and tension.
The U.S. risks not only its reputation as a global economic leader but also the effectiveness of future trade negotiations. The cost of this strategy could translate into loss of influence, competitiveness, and international cohesion.
