ROCHESTER, N.Y. — President Donald Trump is going ahead with plans to impose new tariffs beginning Tuesday on Canadian and Mexican exports to the United States.
Trump on Monday said there is “no room left” for the leaders of Canada and Mexico to stop his long-pledged 25% tariffs on imports from the two U.S. North American neighbors from taking effect after midnight.
The tariffs are expected to be imposed on goods and energy.
The idea long term is that more products will be made in the U.S. and fewer illegal deadly drugs will cross the borders into the country.
Short term, however, economy experts say the tariffs will likely be felt by Americans. That includes when it comes to their energy bills.
Utilities in many areas of upstate New York do import energy from Canada, electricity in particular, along with gas and oil. So, while tariffs could increase the prices of certain products, consumers have options to purchase other similar products, like those made in the USA that do not have imposed tariffs.
However, utility customers don’t generally have the option to shop around for gas and electricity.
Finance experts say if tariffs do apply to energy, customers can expect to see an increase in utility bills.
“The proposed tariff on energy is lower, but energy is an absolute commodity," said finance expert and Chairman of Brighton Securities George Conboy. "Whether we're bringing electricity over the grid or we're talking about natural gas or oil, it doesn't matter who's producing it, who's selling it [or] who's buying it. It's the same thing in every direction. So, a tariff will add immediately to the price."
The White House first announced the tariffs a month ago but delayed the implementation after both Mexico and Canada made efforts to curb the flow of narcotics into this country.
Trump says tariffs would ultimately be beneficial to the U.S. economy and could be an incentive for foreign companies to do more manufacturing here.
“If imported energy costs more, that gives an incentive for domestic producers to produce more energy to capture that increased price," Conboy said. "So, there could be some increased domestic production. In addition, if there is movement by Mexico or Canada to stop the flow of illegal drugs into the country, there are obvious benefits there. But what we don't want to ignore is proposing tariffs and threatening to place them does also give a negotiating advantage."
Conboy says it’s possible Canada and Mexico could come back to the bargaining table and there could be some back and forth along with some unknowns for expenses in the coming months.