WASHINGTON — President Donald Trump’s 11th-hour agreements with Canada and Mexico for both countries to ramp up border security delays the possibility of the president imposing tariffs on all imports from the two countries. But it does not end the threat of tariffs, and some economists say that as long as the risk continues, there could be repercussions for the Texas economy.

What You Need To Know

  • President Donald Trump's threatened tariffs on Mexico and Canada have been delayed for 30 days, but the ongoing uncertainty is already affecting Texas businesses

  • Business leaders and elected officials in Texas worry that tariffs could lead to higher prices for consumers, while also endangering job growth and investment in Texas, with some companies already expressing they will put decision-making on hold

  • Trump and other Republicans say tariffs can force Canada and Mexico to get serious about stopping fentanyl from entering the U.S., but Texas Democrats argue that threatening trade is the wrong strategy

The number of trucks passing through an international bridge in Texas at any moment shows just how much trade there is between Texas and Mexico. 

“The Texas and the Mexican economies are not separate. They're actually very, very tightly integrated. And this goes across lots of products,” said Raymond Robertson, the director of the Mosbacher Institute for Trade, Economics, and Public Policy at Texas A&M University. 

It's why some business leaders and elected officials in Texas are voicing concerns about Trump’s threat of tariffs on imports from Mexico and Canada. Leaders of those countries warned they would retaliate by imposing their own levies on the U.S. 

Jon Barela, president of the El Paso-based Borderplex Alliance, an economic development group, said those costs would be passed along to producers and consumers and could endanger job growth in Texas. He told Spectrum News that he has heard from companies that are now putting decisions on hold. 

“The American consumer will be paying significantly more on items from avocados to automobiles,” Barela said. “The big losers would be the American consumer in the short term, no doubt about that, and it will lead to the loss of millions of jobs, ultimately, if this were to be permanently enacted, these tariffs.”

Texas is the top exporting state in the entire country, and Mexico is the top trading partner. Texas exports nearly $130 billion in goods to Mexico each year, representing nearly a third of the state’s total goods exports.

Although the president’s proposed tariffs have been delayed and may not ever take effect, experts say they are still generating economic aftershocks in Texas.

“The uncertainty reduces investment,” Robertson said. “If you're thinking of starting a new business, or you're thinking of expanding your plant or expanding lines or making a new machinery purchase, you don't want to do that right now. You're going to want to wait until after all of this has been resolved, and that cuts back on business spending, which then ripples through the rest of the economy.”

President Trump and other Republicans say tariffs can force Canada and Mexico to get serious about stopping fentanyl from entering the U.S., but Texas Democrats argue that threatening trade is the wrong strategy.

“These are the things that are the effects of a president who claims that he is good at doing business. I have yet to have someone from that White House explain to us how these tariffs are good for business,” said state Sen. Roland Gutierrez, D-San Antonio.