USA Foreign Policy First Look

If Trump pursues tariffs, Mexico could walk from NAFTA negotiations, minister says

As a presidential candidate, Donald Trump hammered NAFTA as 'the worst trade deal maybe ever signed anywhere,' underscoring his campaign messages on immigration and trade. 

A sign reading in Spanish "Caution, men at work," stands beside the entrance to the main Ford construction site, as a trailer hauls away one of the few remaining pieces of heavy machinery, one day after Ford announced the cancellation of plans to build their auto manufacturing plant, in Villa de Reyes, outside San Luis Potosi, Mexico.
Rebecca Blackwell/ AP
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In the latest chapter of the evolving relationship between Mexico and the United States, Mexican economy minister Ildefonso Guajardo has warned that his country will walk away from any negotiations on revising the North American Free Trade Agreement if the US insists on imposing tariffs on Mexican goods.

As long ago as September, as a presidential candidate, Donald Trump hammered NAFTA as “the worst trade deal maybe ever signed anywhere,” and he has made no secret of his determination to renegotiate its terms. It is, however, just one part of a troubled relationship between the two countries, clouded not least by the proposed border wall and concerns in Mexico about a possible surge in deportations from the US.

Yet there are many that argue that this relationship is vital for both partners, that neither country would prosper by allowing it to flounder. The comments by Mexico’s economy minister may be the latest round in a game of brinkmanship, to see how far each is willing to push before giving ground.

“The moment that they say, ‘We’re going to put a 20 percent tariff on cars,’ I get up from the table,” Mr. Guajardo told Bloomberg. “Bye-bye.”

Just last week, top US officials – including Secretary of State Rex Tillerson and Department of Homeland Security Secretary John Kelly – were in Mexico City, at least in part to try to calm some nerves. Relations between Mexican President Enrique Peña Nieto and the new White House administration have been strained from the outset, and Mr. Peña Nieto cancelled a proposed trip to Washington earlier in February.

Many attribute President Trump's attitude toward Mexico to some of his campaign promises on immigration and trade.

“The question now is how he juggles political realities with long-term national interests,” Michael Shifter, president of the Inter-American Dialogue in Washington, told The Christian Science Monitor last week. “Is the vision of ‘national interests’ one that is based on frustration and emotions, or is it one that is based more on the evidence and facts?”

The overriding concern south of the border is whether Mr. Trump’s goals will result in abandonment of decades-old US policy, which saw stability and prosperity in Mexico as vital to the US national interest.

Yet the relationship is not one-way: The United States needs Mexico, as well as vice versa. The cross-border flow of drugs, as well as immigrants, is diminished in no small part because of cooperation between the two countries’ security forces. And while Mexico’s economy stands to suffer far more than that of the US if the relationship were to break down, cooperation on the security front is, to some observers, the card that Peña Nieto should play in laying down terms of renegotiation for NAFTA.

“What Peña Nieto should say is, ‘These are our red lines. If you want to build a wall, then you will be responsible for stopping everything that comes from Mexico: drugs, migrants, and terrorists,’ ” Jorge Castañeda, a former Mexican foreign minister, told the Monitor in January.

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