LOUISVILLE, Ky. (WAVE) - Kentucky consumers have an active relationship with Mexico’s producers of goods.
According to figures from World Trade Center Kentucky, state consumers and industries purchased $6.7 billion in Mexican products in 2018.
A 5-percent tariff, proposed by President Donald Trump this week, would make those same goods $338 million more expensive.
“Fruits and vegetables, things like that, would be affected,” said Darren Srebnick, Chief Trade Officer of the World Trade Center Kentucky. “But the automotive is where you’re really going to see a tremendous amount of impact.”
Kentucky businesses and consumers purchased $950 million in automobile parts in 2018.
Mexico also imported $1 billion worth of internal combustion engines.
Food and clothing accounted for more than $200 million in purchases.
“This tariff is sort of a death by a thousand paper cuts,” said Iris Wilbur, Government Affairs and Public Policy Director for Greater Louisville Inc. “(It’s) another additional policy position that will tremendously impact greater Louisville and Kentucky.”
If tariffs on Mexico balloon to the full 25 percent later in the year, as proposed by Trump, Kentucky businesses and consumers could be spending $1.5 billion more for the same goods as last year.
“It’s a negative,” IUS Economics Professor Eric Schansberg said. “Anytime you restrict what could be mutually beneficial trade, it has to do harm to an economy.”