How the new tariff backdrop affects Canada & Mexico

In this Update, we answer some of the questions we have received on how the new US tariff regime (see here) will impact Canada and Mexico. The big picture is that Canada and Mexico’s weighted-average tariff rates have declined only a little, and will probably rise again as the Trump Administration is almost certain to impose new tariffs. Moreover, recent events raise the chance that this year’s USMCA negotiations drag on for even longer, prolonging the hit to business confidence and investment.