RALEIGH, N.C. (WTVD) — During a news conference at the White House on Monday, President Donald Trump announced that tariffs on products from Canada, Mexico, and China are set to go into effect at midnight.

There will be 25% tariffs on products from Canada and Mexico, and an additional 10% tariff on goods from China; this brings the total tariff on imports from China to 20%. Trump has previously cited illegal immigration and flow of fentanyl as reasons behind the implementation of tariffs, instituting a 30-day pause with Canada and Mexico last month as negotiations on those issues continued. Trump has also routinely mentioned trade deficits, as he highlighted efforts to encourage companies to build factories domestically.

“It’s going to be very costly for people to take advantage of this country. They can’t come in and steal our money and steal our jobs and take our factories and take our businesses,” said Trump.

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“If you look at the listing of deficits with each of these countries, we import significantly more than these countries are buying from the United States. And he wants to balance that out. They’re aware they have a lot of imports. He wants most of that to come out of the United States, and that’s what he’s trying to do,” said Thomas Cook, the CEO and Managing Director of the management consulting firm Blue Tiger International, as he assessed the President’s strategy.

As part of Trump’s remarks, he singled out North Carolina.

“I used to go there to buy furniture for hotels, and it’s been wiped out. That business now all went to other countries. Now it’s all going to come back into North Carolina,” said Trump.

Stocks fell sharply following the announcement, which came after the Dow, NASDAQ, and S&P 500 all dropped in February.

Friday, the Personal Consumption Expenditures Price Index, a key indicator used by the Federal Reserve, showed inflation cooled slightly in January, though concerns of economic strain were apparent.

“I think that costs are going to go up. You have companies now that are already starting to change their pricing structure,” said Cook.

“These measures will ultimately have an inflationary effect that will be felt very broadly,” said Gaphel Kongtsa, who is the Director of International Policy with the Canadian Chamber of Commerce.

Last month, Cook spoke with a group of North Carolina business leaders about how to navigate tariffs.

“There could be as much as 20 solutions that’s available to companies that import and export to mitigate the impact of tariffs,” Cook said..

“Many larger businesses I think are taking steps to protect their interests and mitigate risks against tariffs. One way of doing that is stockpiling and finding alternative markets but that sort of avenue is not available to all businesses. Smaller businesses, unfortunately, don’t always have the resources and the capacity to shift and maneuver their operations on such short notice,” said Kongtsa.

Canada is North Carolina’s top international trading partner. According to the EDPNC, through November there was $12.3 billion year-to-date in trade between North Carolina and Canada, a figure which surpassed 2023 figures.

One industry that is particularly vulnerable to tariffs: agriculture.

“Canada is the world’s largest exporter of potash and potash, of course, is a key ingredient in fertilizers. The United States sources nearly 80% of its fertilizers from Canada, and that includes farmers in North Carolina,” said Kongtsa.

According to a 2024 report from NC State University economist Dr. Mike Walden, the agriculture industry in North Carolina had a $111.1 billion economic impact in the state.

In a statement Monday, Canadian Prime Minister Justin Trudeau said “fentanyl seizures from Canada dropped 97 percent between December 2024 and January 2025” adding “there is no justification for these actions.”

In response to the tariffs placed by the United States, Trudeau wrote in part:

“Canada will not let this unjustified decision go unanswered. Should American tariffs come into effect tonight, Canada will effective 12:01 a.m. EST tomorrow, respond with 25 per cent tariffs against $155 billion of American goods – starting with tariffs on $30 billion worth of goods immediately, and tariffs on the remaining $125 billion on American products in 21 days’ time. Our tariffs will remain in place until the U.S. trade action is withdrawn, and should U.S. tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures. While we urge the U.S. administration to reconsider their tariffs, Canada remains firm in standing up for our economy, our jobs, our workers, and for a fair deal.”

“It’s worth noting that Canada is North Carolina’s largest export market with over $7.7 billion of exports from North Carolina going into Canada each year. These range from pharmaceuticals to auto parts to to engines to plastics. It’s really a very wide range of goods being sold to Canada,” said Kongtsa.

He said Canadian businesses are aware of the importance of the US market, adding the effect of tariffs will be felt by consumers and companies on both sides of the borders.

“These measures will ultimately have an inflationary effect that will be felt very broadly,” Kongtsa said.

The EDPNC reports Mexico is North Carolina’s second-largest import market and third-largest export market, and Chinese companies employ more people in North Carolina than any other state.