Outlook on the Trump administration’s trade and tariff policy

As day one executive orders were announced by the new administration and signed by President Trump, many were surprised that specific tariff announcements widely signaled during the presidential campaign failed to materialize. Instead, as part of his day one executive actions, Trump issued the America First Trade Policy memorandum (the memorandum) calling for a comprehensive review of U.S. trade policy, unfair trade practices, and trade imbalances.

Areas to watch

Section 2 of the memorandum outlines the administration’s priority areas around trade and signals an intent to pursue policies promoting investment and productivity in the United States. The framing of the memorandum also signals the wide range of policy aims that will be pursued through trade and tariffs. Specifically, the memorandum was addressed to the Secretaries of Commerce, Treasury, Homeland Security, State, and Defense, along with the Director of Management and Budget, the U.S. Trade Representative, the Senior Counselor for Trade and Manufacturing, and the assistant to the president for economic policy.

The following are areas of special interest to Plante Moran clients:

• Unfair/unbalanced trade. The memorandum calls for the Secretary of Commerce to investigate causes and risks inherent in “unfair and unbalanced trade” and recommend actions to remedy them, including “tariffs or other policies.” The review embodies a wide swath of economic concerns, including free trade agreements, currency manipulation, antidumping and countervailing duty laws, discriminatory or extraterritorial taxes on U.S. citizens or corporations, and loss of tariff revenues resulting from the current implementation of the $800 or less, duty-free de minimis exemption under Section 1321 of title 19, United States Code.
• Canada and Mexico. The United States Trade Representative (USTR) is instructed to begin the public consultation process in preparation for the review of the United States-Mexico-Canada Agreement (USMCA) due in July 2026. As part of this, the USTR is specifically directed to review the impact of USMCA on “American workers, farmers, ranchers, service providers, and other businesses.”
• China. The USTR is directed to review the current economic and trade agreement with the People’s Republic of China to determine China’s compliance and recommend any appropriate actions, including tariffs. The USTR is also directed to assess China’s actions related to technology transfer, intellectual property, and innovation, and consider costs and tariff modifications with respect to “industrial supply chains and circumvention through third countries.”

Timeline to action

The memorandum calls for reviews to be completed by April 1, 2025, and we anticipate tariff actions will follow after that date, although Trump did signal that potential actions could occur sooner. For example, during the signing ceremony on Jan. 20, 2025, he mentioned consideration of 25% tariffs on Canada and Mexico on February 1 to to address immigration and the influx of fentanyl. And on Jan. 21, 2025, Trump issued a similar threat to impose a 10% tariff on China in response to fentanyl shipments.

Recommended actions

The memorandum and months of tariff-related messaging create an environment where it can reasonably be assumed that the Trump administration will take actions in the near future. However, it’s risky for companies to make major financial decisions based on current speculation or political rhetoric regarding tariffs. At this time, the specific tariffs that may be implemented are unclear, and any preemptive actions taken now could be rendered ineffective if tariffs are applied retroactively. 

Instead, companies should consider the following actions:

• Establish a clear understanding of where your sourcing is coming from and any type of potential risk that can arise out of the full range of potential actions by the administration.
• Formulate a contingency plan to address the risks based on a structured scenario-planning process. This should include establishing a variety of alternative scenarios and plans to respond to potential impacts to ensure business continuity.
• Carefully monitor developments over the coming weeks and months. This is expected to be a fluid situation, likely involving periodic announcements of individual actions.

For further thoughts on how to prepare, read our article, “Untangling tariff impact: Actions to navigate evolving U.S. tariff and trade policies.”

Plante Moran will continue to issue updates as the policies unfold. Further sources of up-to-date commentary on trade policy complexities include:

• Presidential actions posted by the White House at whitehouse.gov.
• Trade groups such as the Motor Equipment Manufacturers Association (mema.org), which has a government affairs council and a Washington, DC office.
• Washington policy groups such as the National Association of Manufacturers (nam.org) that track and analyze regulatory and legislative activity.
• Geopolitical analysts such as Ian Bremmer and the GZeroWorld (gzeromedia.com), and thinktanks such as the Peterson Institute for International Economics (piie.com).