Economists warn Tampa residents of price spikes from new tariffs

Impact of tariffs on Mexico and Canada

FOX 13’s Kylie Jones reports on the potential impacts of President Donald Trump’s new economic tariffs against countries like Mexico and Canada, which experts worry will have disastrous effects on consumers.

TAMPA, Fla. - President Donald Trump’s latest tariffs target lots of everyday goods used by American consumers.

Trump placed a 25% tariff on imports from Canada and Mexico, and doubled the tariffs on goods from China to 20%.

President Donald Trump signing new tariffs among the U.S.'s top trade partners.

Economic experts say that while tariffs are not new, the magnitude of these recent tariffs is significant.

The backstory:

Canada, Mexico, and China are the United States’ three largest trade partners.

"You start looking at things like the importation of electricity from Canada," Abby Hall Blanco, associate professor of Economics at the University of Tampa, said.

READ: US tariffs on Mexico, Canada take effect on Tuesday: What to know

Mexico is a large supplier of produce, beer, and other agricultural goods to the U.S.

"Like the avocados, the tomatoes," said Dr. Amir Neto, the Director of the Regional Economic Research Institute at Florida Gulf Coast University. "They come straight from Mexico if you go to Publix (or) Aldi."

The auto industry is expected to be among the hardest hit by the tariffs.

Last year, the U.S. imported tens of billions of dollars’ worth of automobiles and auto parts from Canada and Mexico.

China is a top supplier of electronics, like cellphones and computers, too.

What they're saying:

"They can’t come in and steal our money and steal our jobs and take our factories and take our businesses and expect not to be punished," Trump said about the tariffs. "And, they’re being punished by tariffs."

Trump has previously said that the tariffs are meant to punish all three countries for the flow of illegal drugs and migrants over U.S. borders.

READ: Gov. DeSantis urges pocketbook issues in state of the state address

"There is this idea that it's going to harm the country that it's being imposed on without harming U.S. producers or U.S. consumers," Blanco said. "And that's just simply not the case."

Blanco says Americans could be affected by not only the retaliatory tariffs but also the U.S.-imposed tariffs.

"That's going to make it more expensive for businesses in the state of Florida and in the Tampa Bay area to do business," Blanco said. "And, it's also going to increase prices for consumers."

Supporters of the tariffs have also argued that tariffs will force more domestic production and business.

READ: Tampa Bay area farmers view hope in President Trump’s new tariffs

However, Neto says domestic production comes at a cost and can take years to build up.

"If we think about agricultural goods, those take a year, five, 10 years, depending on the crops, to really grow and be able to give you what you need," Neto said. "Similar things are going to be for manufacturing, right? It takes time for you to build your manufacturing facility."

Revenue from the tariffs goes back to the federal government, but the revenue is reliant on the importation and exportation of goods.

What's next:

Experts say it’s unclear exactly how much impact consumers will feel.

"To what extent will certain store chains be able to absorb that cost, and how much others will have to pass on to the consumers? That will be (a) business-to-business decision," Neto said.

Experts say consumers won’t see the impact immediately, and prices will take several months to change.

The Source: FOX 13's Kylie Jones collected the information in this story.

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