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Mexico: How far has it come to avoid Trump's "day one" tariffs?
Tuesday, January 14, 2025 - 08:12
Foto Reuters

Claudia Shienbaum's administration has seized a record amount of illicit fentanyl, imposed new tariffs on some Asian products, and confiscated counterfeit Chinese goods in several cities.

In late November, President-elect Donald Trump sent shockwaves through global trade by threatening to impose 25% tariffs on Mexico and Canada, putting a regional trade deal in jeopardy, if the two countries did not do more to stem migration and the flow of drugs into the United States.

It was a big test for Mexico's president, Claudia Sheinbaum, the country's first woman president and who had taken office just eight weeks earlier. Analysts had thought she might be too rigid and reserved to handle the volatile U.S. leader with the aplomb of her predecessor, Andrés Manuel López Obrador.

As Trump prepares to take office in a week and Sheinbaum has had public clashes with him, she has also presented concrete results that could help show Mexico is serious about cooperation on migration, security and China.

It's hard to know whether that will be enough or whether Trump's threat of tariffs on his first day in office was entirely realistic, but experts and former diplomats say the Mexican leader is off to a solid start.

"It's a very pragmatic and proactive approach by Sheinbaum and her team," said Gema Kloppe-Santamaría, a researcher at the Wilson Center's Mexico Institute.

Trump has repeatedly accused the Mexican government of not doing enough to stop migrants and drugs from entering the United States and has threatened to impose sweeping tariffs to force it to take further action. He has also criticized the installation of Chinese factories in Mexico.

But since taking office, Sheinbaum has stepped up a historic crackdown on migrants traveling toward the U.S. border, detaining an unprecedented 475,000 between October and December and has left open the possibility that Mexico might be willing to accept non-Mexicans deported from the United States.

His administration has also seized a record amount of just over a ton of illicit fentanyl, imposed new tariffs on some Asian goods and confiscated counterfeit Chinese products in several cities.

“She is sending the message that she is a strong political leader,” Kloppe-Santamaría said, pointing to recent polls showing Sheinbaum has increased her popularity to a staggering 80% after her first 100 days in office. “Trump certainly has a lot of power and legitimacy, but so does she,” Kloppe-Santamaría added.

Reuters spoke to seven economic analysts, former Mexican diplomats and academic experts on Mexican politics. Most praised Sheinbaum's strategy to get closer to Trump.

"This commitment that Mexico has demonstrated to fully align its interests with those of the United States is what makes us more confident that President Claudia Sheinbaum and President-elect Donald Trump will overcome the initial threats and uncertainty," said Rodolfo Ramos of Bradesco BBI.

CALCULATION ERROR

The future U.S. leader is known for being unpredictable, but Sheinbaum has also maintained an element of surprise, said Jorge Guajardo, a former Mexican ambassador to China. While she has suggested that Mexico could impose retaliatory tariffs, she has not revealed details.

"She's been very smart and strategic," Guajardo added. "She wants to keep her powder dry."

But for former Mexican ambassador to the United States Arturo Sarukhán, Sheinbaum's government may not be reading the situation correctly. "I think that is a huge miscalculation," he said.

"There's a sense that this is some kind of showmanship (by Trump) and it's being used to extract concessions and negotiate and demonstrate to his base that he's doing what he was going to do and at the end of the day he's not going to do what he promised," he said.

Mexico is one of the countries that has the most to lose from a second Trump presidency, experts say.

The United States is by far Mexico's largest trading partner, and the Republican leader's tariff threats could have a strong impact on the Mexican economy.

Trump has also promised mass deportations that could disrupt Mexico's labor market and create humanitarian and security problems in a country already shaken by violence, internal displacement and weak economic growth.

Then there are Trump's threats of unilateral U.S. military action inside Mexico, which "is basically an act of war," Sarukhán said.

The former ambassador warned that U.S.-Mexico relations could be more volatile than in decades past and that Mexico City should be prepared for Trump 2.0 to be even more extreme than Trump 1.0.

But Sheinbaum seems to have a well-prepared strategy. The measures her government has taken could be enough, for now.

"I think these measures are enough to establish a floor in the negotiations and prevent Trump from imposing tariffs from day one," said Matías Gómez, an analyst at the Eurasia Group consultancy.

"However, this threat will act as a sword of Damocles throughout 2025 as a latent risk that will allow Trump to pressure Sheinbaum on multiple fronts," he added.

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Reuters