Written by Jamie Rodgers, CEO of J.M. Rodgers Co., Inc.

A little over a week ago the trade community was thrown into what now seems like a regular turmoil when President Trump floated the possibility of imposing a brand new set of tariffs on imports coming from Mexico, unless the Mexican government took sufficient steps to stem the migrants crossing the border into the United States.

Late last Friday a statement from the State Department announced that an agreement had been reached on both trade and border enforcement between the two countries. The tariff imposition was called off following the announcement. While short on details, it involved promises by Mexico to increase military presence on the border with Guatemala and hold migrants seeking asylum in Mexico while their claims are processed. However, the tariff threat is not totally gone. After the announcement of the agreement, Trump said that if the Mexican legislature fails to approve the agreement then the tariffs would be implemented.

While new duties out of Mexico appear to be past, tariffs on Chinese imports may continue their increase. Since the imposition of wave 3 of the tariffs months ago, there have been repeated threats to add additional tariffs on all imports not currently subject to them. The threat was put off until the G-20 upcoming this month in Japan, but President Xi has said they may not attend. In response, Trump has threatened to immediately impose those additional duties on Chinese imports if Xi does not attend for further negotiations.

It has not yet been made clear how the tariffs out of Mexico would have been eligible for drawback returns. As of late last week Customs had not provided any information to importers as to how these tariffs would be implemented operationally, and so there was still a lack of clarity as to how they would work.

Trade turmoil has caused problems for both importers and government agencies alike. If you have any questions about how these tariffs would affect your company, please contact our VP of Sales Andrew Galloway at 973-726-5340 or agalloway@jmrodgers.com.