As Trump's Trade War Escalates, Businesses and Residents in Border Cities Feel The Effects

As President Trump's trade war with foreign countries, specially Mexico and Canada, escalates some American residents are starting to feel the effects.

Trump on Tuesday enacted 25% tariffs on all Mexican imports to the U.S. and on most merchandise coming from Canada. On Thursday, he put on pause for a month on most imports related to the USMCA. Residents and businesses in border cities like El Paso and Juarez have started to experience these bumps on their jobs and money, according to the Border Report.

"There certainly have been some jobs at least put on hold and we're hearing from employers in the region second-guessing whether they should even be involved in (the U.S.-Mexico-Canada Agreement) because of its unpredictability," said Jon Barela, chief executive officer of the Borderplex Alliance, "and that maybe they should go to other regions and other countries that have some level of predictability."

Barela, whose organization promotes investment in the El Paso-Juarez-Las Cruces, New Mexico, region, also worries small short-term losses may turn into substantial missed investment opportunities in the long term.

"The people who are involved in making investing decisions are on freeze. They're pausing their decisions. They invest tens if not hundreds of millions of dollars and they can't simply turn on a switch and decide to move to the United States. It doesn't happen that way," he said. "In the long-term, if we don't get this straightened up, it will certainly hurt U.S. revenues."

Similarly, Marcelo Vasquez, regional director of the National Association of Mexican Importers and Exporters, said some employers in Juarez are already renegotiating labor contracts knowing they will have to lay off workers if the tariffs stay beginning next month. Others, in the meantime, are rushing to complete orders for parts or products and get them across the border before Trump decides to reinstate the tariffs.

"Many maquiladoras are asking their suppliers for many things including pallets," to cross as much merchandise as possible, Vasquez told Border Report. "There are those who are working frantically and others that are already hurting (economically) and have slowed down even more."

Trump's trade war on Mexico and Canada has been the focus of attention for weeks now as the president seeks to advance his "America First" agenda, breaking decades-long stable relationships with foreign countries. Despite the recent pause on tariffs, the discourse is nowhere near over.

After Trump announced the latest one-month pause on most tariffs, Mexico's President Claudia Sheinbaum decided to hold off on retaliatory tariffs. Canadian Prime Minister Justin Trudeau has said that Canada's retaliatory measures will remain in place, CNN reports.

Trump said over the weekend that tariffs on both countries, which are planned for April 2 "could go up" and would not predict whether the U.S. will have a recession in 2025. Likewise, Canadian economist Mark Carney, who will replace Trudeau, is expected to focus on U.S.-Canada relations as he assumes the top position in the Great White North.