IEDC Members,

We want to provide you with an important update on the evolving tariff situation and its potential implications for businesses and economic development.

As of midnight last night, President Donald Trump has announced plans to impose a 25% tariff on imports from Canada and Mexico starting today, Tuesday, March 4, while also doubling the existing 10% tariff on imports from China that took effect earlier this month. View the White House fact sheet. These measures are being instituted by the Trump Administration as part of a broader effort to combat illicit drug trafficking into the United States as well as trade imbalances, with the administration arguing that the tariffs will pressure trading partners to take stronger enforcement actions.

In a recent Truth Social post, President Trump cited the need to curb the flow of fentanyl and other illicit substances, stating that the tariffs will remain in place "until it stops, or is seriously limited." In response, Canada has appointed a fentanyl czar, and Mexico has deployed 10,000 members of its National Guard to its northern border to address concerns over drug trafficking. Both countries have also outlined additional tariffs against the United States in response, including Canada hitting the U.S. with 25 percent tariffs on C$30 billion of U.S. goods, and the threat of C$125 billion more after a 21-day consultation period. The list of what would get tariffed immediately includes food — poultry, beef, fish, yogurt and more — along with various textiles and furniture.

We recognize that this policy will have varying impacts across our membership, especially given the international participation we have across our programs and membership. While some industries may benefit from stronger protections for domestic production in the United States, others—particularly those reliant on international supply chains—could face higher costs and disruptions. Additionally, potential retaliatory measures from Canada, Mexico, and China may continue to impact U.S. exports, compounding uncertainty for businesses and communities across the country. The implications for communities across the globe are deep, and it is important for any IEDC member to understand the local and regional implications for businesses in their area.

We will continue to keep you updated as we learn more. In the meantime, we encourage all members to:

Stay Informed: Monitor official communications from the U.S., Canadian and Mexican governments, as well as responses from other international government authorities, to stay updated on policy changes and potential retaliatory measures.

Assess Local Impact: Identify industries within your service area that rely on imports or exports. Evaluate potential implications to businesses and supply chains in your region.

Engage with Affected Businesses: Communicate with local businesses to understand their concerns and provide guidance on mitigating the impact of the tariffs.

Explore Alternative Supply Chains: Assist businesses in identifying alternative suppliers or new customers to reduce their reliance on imports or exports subject to tariffs.

Advocate for Support: Work with local and state officials to develop support mechanisms for businesses adversely affected by the tariffs, such as financial assistance or tax relief.

Keep IEDC informed on what you are hearing and any specific impacts experienced by your communities or regions.

IEDC continues to closely monitor these updates and we will continue to provide updates and resources as the situation evolves.