What does North American Trade War Mean for Belize?

The escalating trade war between the United States, Mexico, and Canada has sent ripples through the global economy, with significant implications for small importing countries like Belize. Initiated by the imposition of twenty-five percent tariffs on Mexican and Canadian goods by the U.S., this conflict has prompted swift retaliatory measures from both neighboring countries. For Belize, which relies heavily on imports and maintains close economic ties with the U.S., the fallout from this trade war could lead to increased costs for goods, disrupted supply chains, and broader economic instability. As the situation unfolds, Belize and other small nations must navigate these challenges to mitigate the adverse effects on their economies. Earlier today, News Five sat down with economist, Doctor Leroy Almendarez, for his perspective on the trade dispute.

 

Dr. Leroy Almendarez, Economist

“Certain wars are triggered, others might just have been saying, “Well this is how my economy is working.” As you know, there has been an existing trade relationship between Canada, the US and Mexico, reconfigured at different times, NAFTA, and then it was changed in terms of its dimensions.  But what has happened, I think that there’s another part to it.  The President of the United States is saying, or President Trump is saying, “Mexico, you have a problem with your cartels and illegal immigration, so we want these people to, really, if you don’t do anything to stop them from coming across our border then we will do something for you to act.  In the case of Canada, they are saying the same thing, you know, that drugs are coming into the United States.  And so, he believes that if you levy these tariffs on goods from Canada, goods from Mexico, but goods from China, as well, but China is the… when it comes to that trade relationship between China and the United States, I mean, China holds the largest part of America’s debt.  So that’s an issue in itself.  So, when these tariffs were levied, if you look at it just as a one-way thing, what would basically happen is immediately, as soon as they are levied, you’ll have to mark up your prices.  Prices of goods from Canada going into the United States, those prices will go up.  But what Canada has done and if you listen to the outgoing Prime Minister, really, Trudeau, he decided to levy reciprocal taxes.” It’s the same thing with Mexico.  Mexico has not responded in kind as yet, but more than likely the tax will be reciprocal, meaning one for one.  In the case of China, China will do the same thing.”