Amendment to Duties to Address the Flow of Illicit Drugs Across Our Southern Border
March 6, 2025
Action Summary
- Purpose: Adjust tariffs imposed on certain Mexican articles under Executive Order 14194 to minimize disruptions in the U.S. automotive industry and protect automotive workers.
- Background: Emphasizes the importance of automotive production in U.S. employment, innovation, economic, and national security, while supporting a closer North American supply chain.
- Product Coverage:
- Duty-Free Articles: Items entered duty-free under general note 11 to the HTSUS, including provisions under subchapters XXIII (chapter 98) and XXII (chapter 99) as per the USMCA, will not incur the additional ad valorem duty.
- Potash Tariff: The additional duty on potash not covered by the duty-free provision is reduced from 25% to 10%.
- Effective Date: Changes apply to goods entered or withdrawn for consumption on or after 12:01 a.m. EST on March 7, 2025.
- General Provisions:
- Agency Authority: Does not impair the authority of executive departments or the functions of the Director of the Office of Management and Budget.
- Implementation: To be carried out in accordance with applicable law and subject to appropriations.
- Legal Effect: The order does not create any enforceable right or benefit against the U.S. government or its agencies.
Risks & Considerations
- The Executive Order focuses on adjusting tariffs related to the automotive industry and potash imports from Mexico, which could impact trade relations and economic dynamics between the United States and Mexico. This may affect industries reliant on these imports, potentially leading to shifts in supply chain strategies.
- Changes in tariffs could influence the cost of goods and materials, impacting industries that depend on automotive parts and potash. This may lead to increased operational costs for businesses and could affect economic stability in regions heavily involved in these sectors.
- The reduction in tariffs on potash may benefit agricultural sectors that rely on this mineral for fertilizer, potentially lowering costs for farmers and impacting agricultural research and development.
- Vanderbilt University may need to consider how these economic changes could affect its research programs, particularly those related to economics, trade, and international relations.
Impacted Programs
- Vanderbilt’s Owen Graduate School of Management may see increased demand for expertise in international trade and economic policy, providing opportunities for research and collaboration with industry partners.
- The Department of Economics could benefit from analyzing the impacts of tariff adjustments on the U.S. economy, offering insights into trade policy and economic strategy.
- Vanderbilt’s School of Engineering might explore the implications of supply chain adjustments in the automotive industry, potentially leading to new research initiatives and partnerships.
- The Office of Federal Relations may need to engage with policymakers to understand the broader implications of these trade adjustments and advocate for the university’s interests.
Financial Impact
- The adjustment of tariffs could lead to changes in funding opportunities for research related to trade and economic policy, potentially affecting grant applications and partnerships.
- Vanderbilt University might experience shifts in its funding landscape, particularly if federal priorities change in response to the economic impacts of these tariff adjustments.
- There may be opportunities for Vanderbilt to secure funding for research on the economic and trade implications of these policy changes, particularly through collaborations with federal agencies and industry partners.
- As the economic environment evolves, there could be changes in the demographics of students interested in programs related to economics, trade, and international relations, potentially affecting enrollment and tuition revenue.
Relevance Score: 3 (The order presents moderate risks involving compliance or economic impacts that may require strategic adjustments.)
Key Actions
- Vanderbilt’s Economic and Business Research Center should analyze the impact of tariff adjustments on the automotive industry, particularly focusing on supply chain dynamics and employment trends. This analysis can help the university understand potential economic shifts and prepare for changes in industry partnerships or research opportunities.
- The Office of Federal Relations should monitor developments related to trade agreements and tariff policies, as these could affect research funding and collaboration opportunities with industries impacted by these changes. Engaging with policymakers to advocate for research interests aligned with national economic priorities could be beneficial.
- Vanderbilt’s Law School could explore the legal implications of the executive order, particularly in terms of international trade law and its effects on U.S.-Mexico relations. This could provide valuable insights for students and faculty interested in international law and policy.
Opportunities
- The executive order presents an opportunity for Vanderbilt’s Engineering School to engage in research and development projects aimed at enhancing automotive technologies and supply chain efficiencies. Collaborating with industry partners could lead to innovative solutions and increased funding for research initiatives.
- Vanderbilt can capitalize on the focus on economic and national security by developing interdisciplinary programs that address the intersection of technology, policy, and international trade. This could enhance the university’s reputation as a leader in addressing complex global challenges.
Relevance Score: 3 (Some adjustments are needed to processes or procedures to align with potential economic and research opportunities.)
Timeline for Implementation
- Effective 12:01 a.m. EST on March 7, 2025.
This timeline was determined directly from Section 2(c), which specifies the enforcement date for goods entered or withdrawn for consumption.
Relevance Score: 5
Impacted Government Organizations
- Office of Management and Budget (OMB): Explicitly referenced in Section 3(a)(ii) to ensure that its budgetary, administrative, and legislative functions remain unaffected, making it a key stakeholder in the implementation of the order.
- U.S. Customs and Border Protection (CBP): As the primary agency in charge of regulating and enforcing tariffs at U.S. ports of entry, CBP is directly impacted by the modifications to duties on imported goods.
- Department of Commerce: Given its oversight of international trade policies and involvement in facilitating supply chains, the Department of Commerce is likely affected by these adjustments to tariffs and trade rules concerning automotive parts and components.
- Department of Homeland Security (DHS): By virtue of its supervision of CBP and its broader role in border security, DHS is also impacted by changes in trade enforcement measures.
Relevance Score: 2 (Between 3 and 5 agencies are affected by this executive order.)
Responsible Officials
N/A – No specific executive department, agency, or official is explicitly designated within this order; implementation is left to be carried out according to applicable law by the relevant agencies.
Relevance Score: 1 (The order does not pinpoint implementation responsibilities to specific high-level officials, resulting in only incidental directive impact.)