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Business leaders reacted with dismay to Trump’s statement Thursday that he would impose a new 5 per cent tariff on all goods from Mexico beginning June 10 to force the Mexican government to take more aggressive actions to prevent Central American migrants from crossing its territory en route to the United States.

If the administration determines that Mexican authorities have not done enough in response, the tariff automatically jumps to 10 per cent on July 1 and then continues rising in five-percentage-point increments at the start of each subsequent month until it reaches 25 per cent on Oct. 1, according to a White House statement.

The president’s new tariff increases would 'essentially blow up USMCA' Rufus Yerxa, president of the National Foreign Trade Council

The tariffs could undermine an economic relationship that has been deepening for decades, and throw into chaos corporate and agricultural supply chains that have essentially worked in a system without tariffs since the 1994 North American Free Trade Agreement. Mexico is on track to become the United States’ largest trading partner, ahead of China and Canada, according to census data through March.