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Non-political tariffs thread


DixonHur

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A good, short read on the new Mexican president's approach to the negotiations.

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How Mexico’s President Avoided U.S. Tariffs, for Now
President Claudia Sheinbaum’s abilities to deal with a major crisis were on full display as President Trump’s tariffs on Mexican goods were paused for a month.

When President Claudia Sheinbaum of Mexico announced on Monday morning that she had struck a deal with President Trump to pause steep tariffs on her country for a month, Gerardo Fernández Noroña wasn’t surprised.

Mr. Fernández Noroña, the president of the Mexican Senate and a member of Ms. Sheinbaum’s governing party, said he knew she had the situation under control as soon as heard that the two heads of state would talk by phone that morning.

“It was a great negotiation,” he said in a telephone interview hours after the announcement. “It seemed, in general, that there was no room for the level of understanding, but she handled it very well.”

As Mexico stared down a trade war with its biggest trading partner and neighbor, Ms. Sheinbaum secured an important reprieve — and a collective sigh of relief — for her country less than a day before the tariffs were set to take effect. It also put her abilities to deal with a major crisis on full display.

The details of the behind-the-scenes negotiations between Mr. Trump and Ms. Sheinbaum have not been publicly released. But this much is clear: In exchange for the Trump administration postponing 25 percent tariffs on Mexican goods until at least early March, Mexico will post an additional 10,000 Mexican National Guard members on the border with the promise to “prevent drug trafficking,” in particular fentanyl.

While the increase in the number of troops is new, Mexico using the National Guard to patrol the border isn’t. And ultimately, it seems Mexico conceded very little in order to stave off potential economic doom.

The U.S. government even agreed to do something Ms. Sheinbaum has repeatedly called for, even if the agreement was light on details: working together to stop the flow of arms into Mexico.

“I’m surprised,” said Carlos Bravo Regidor, a political analyst based in Mexico City, “because I didn’t expect it to be so easy or so cheap for Mexico.”

Since before she was voted into office in June, Ms. Sheinbaum and her team were preparing for the possibility that Mr. Trump returned to the White House. And since his victory in November, Ms. Sheinbaum has reiterated that she wasn’t concerned despite his threats of mass deportations and tariffs. The day after the U.S. elections, she promised to “establish communication and good relations.”

Her predecessor and mentor, Andrés Manuel López Obrador, forged a close working relationship with Mr. Trump in the early years of his administration, despite similar circumstances: Mr. Trump’s repeated threats to impose tariffs on Mexico and make the country pay for a border wall. In an effort to stave off levies, Mr. Lopez Obrador agreed to bolster immigration enforcement, including deploying the National Guard.

Conditions, though, have changed since then. Mexico has eclipsed China as the largest trading partner in goods with the United States. And Mexico emerged as the top market worldwide for U.S. food and agriculture exports, with those imports surging to more than $29 billion.

But there is a key difference between Mr. López Obrador and Ms. Sheinbaum: While he at times adopted a confrontational tone toward the United States, she maintains a more measured and composed demeanor.

“Everyone has their style,” Mr. Fernández Noroña said. “She has her own sensibility and her own form.”

On Monday, Ms. Sheinbaum said that she had a “very respectful” conversation with Mr. Trump that lasted at least 30 minutes. Mr. Trump described the call as “very friendly” — a sharp contrast with some of his statements about Prime Minister Justin Trudeau of Canada, whose country was also a tariff target

After her call with Mr. Trump, Ms. Sheinbaum said, “There is a relationship of respect and of equals, which is what is important.”

During the last few weeks, Ms. Sheinbaum and her team were been tight lipped about how they might respond to the implementation of tariffs by the United States. After Mr. Trump ordered them put in place, Ms. Sheinbaum promised to reveal on Monday the initial steps of her administration’s so-called Plan B response — but she first asked that Mr. Trump respond to her request to form a working group of security and health officials from both countries.

Viridiana Ríos, a Mexican-based political analyst, said Ms. Sheinbaum’s strategy was partly grounded in presenting the White House with data that allowed Mr. Trump to claim a victory to his supporters on critical issues like immigration. Mexican officials demonstrated to their American counterparts that they had successfully curbed northward migration, addressing another of Mr. Trump’s frequent concerns. In response, he declared that border security had been significantly strengthened.

Ms. Rios said that the most important lesson Mexico could learn from this episode was the urgent need to create regional alliances and diversify its economy to make it less reliant on its, at times, erratic neighbor. In 2020, Mr. Trump signed a trade treaty called the U.S.-Mexico-Canada Agreement, yet now he was going after economic allies.

“The United States is no longer the reliable trading partner it once was,” she said, adding later, “His threats will only continue, and my fear is there might be a moment where we don’t find a way to satisfy him.”

 

 

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