The stakes of trade war between the United States and its next door neighbor, Mexico, Canada, and Australia: Business and e-commerce are high

As President Trump threatened to impose steep tariffs on imports from Argentina and Australia, businesses and shoppers in the US are bracing for higher prices on a broad range of goods.

Trump threatened tariffs on imports from Colombia last weekend, but changed course after that country reached an agreement with the U.S. on terms for accepting deportees. The stakes of a trade war with Mexico and Canada are much higher. The trade between the United States and its next door neighbors is 20 times greater than with the country it’s in.

Many businesses are making contingency plans even though the tariffs size and scope are not yet known. Trade data released on Wednesday showed a sharp rise in imports in December, suggesting some companies tried to stockpile goods before any tariffs take effect.

“Importers were trying to bring in goods ahead of time,” says Matthew Martdin of Oxford Economics. The cost and risks of holding inventory are not without it. But businesses clearly believe there will be enough demand that they won’t be sitting on this inventory for long.”

Some individual shoppers also tried to beat the tariffs. Personal spending on durable goods such as autos and televisions jumped in December, according to figures released Friday by the Commerce Department. Mexico is a leading producer of flat-screen TVs.

General Motors told financial analysts on Tuesday that it could shift some pickup truck production out of Mexico and Canada if tariffs are imposed. But the automaker is reluctant to act while the trade landscape is still uncertain.

Implications of the Trade War for China: What are the “ifs” of a Trump-dominated Central Bank? Is there a “no-frills” scenario?

Martin said that “increasing expenses by 25% will lead to higher costs at the pump and input costs for businesses around the country.”

Martin said that equity markets don’t like tariffs on Canada and Mexico. It would hurt the economy and hopefully he wouldn’t be going full bore. This might just be more of a negotiating tactic.”

Trump has said the tariffs on Canada and Mexico are punishment for immigration as well as fentanyl coming into the US from the two countries. But he uses them as petty bargaining chips, too — earlier this month, he briefly vowed to impose tariffs on Colombian imports like coffee unless the country accepted military deportation flights. As potentially disruptive as tariffs could be, there are a lot of “ifs” here. The Trump administration is already behind on its own schedule. It reportedly still doesn’t know exactly which tariffs it will be imposing. The chaotic freeze of federal funds was the last policy change and was blocked by a court but walked back after much public anger. So it’s anyone’s guess how long an all-out trade war could last — if it happens at all.

The US is China’s third- largest trading partner and a source of everything from cheap clothing and home goods to electronics.