It was a busy Saturday in North America, which is once again waiting for orders from the White House, always with tariffs as a backdrop. US President Donald Trump sent a letter to his Mexican counterpart, Claudia Sheinbaum, announcing a 30% tax on imported Mexican products outside of the USMCA, the trade agreement in force with the US and Canada. Nothing new on the radar. Since his return to the presidency in January, Trump's tariff threats have dominated US relations with Mexico, focusing on specific products, such as aluminum and steel, or generalized, as is the case now. The neighboring government has always responded cautiously, taking advantage of the negotiating space left by the magnate's warnings. This Saturday was no exception.
Shortly after releasing the letter announcing the new tariffs, the Ministry of Foreign Affairs published its response on social media. Mexico has maintained a negotiating mission in Washington since Friday. Its objective is to present Trump with a"general agreement" on security, migration, and tariffs, according to the Mexican government this week. Thus, Trump's letter has literally caught diplomats on the spot."We were informed that all countries would receive a letter signed by the President of the United States establishing new tariffs effective August 1. We mentioned at the meeting that it was an unfair deal and that we did not agree," the Ministry of Foreign Affairs stated in its response.
Visiting Sonora, President Sheinbaum took advantage of the inauguration of a hospital to address the issue."The letter [from Trump] clearly establishes that they are seeking to reach an agreement to eliminate these tariffs. They set it for August 1. We believe we will reach an agreement, with better conditions," she said. Since March, Mexico has faced tariffs of 25% on its exports outside the USMCA, such as fertilizers, cork, paper, books, and silk, among other products. With the modification, the tax would rise to 30%. Sectoral tariffs of 50% on steel and aluminum, and a lower 25% on cars and some auto parts, are also on the sidelines.
The tariff puzzle is complex, especially due to Trump's vagaries. In any case, the change announced this Saturday appears unlikely to significantly affect Mexican industry because more than 80% of exports to the US comply with the USMCA. The real problem lies in the rate the Republican imposes on metals, vehicles, and auto parts, in addition to potential levies on the agricultural industry, particularly tomatoes, which Trump has set at 17% starting next week. Despite the tariffs, Mexico remains the US's main trading partner. In the first five months of the year, it sent $219.5 billion in exports to the US market, according to official figures. The Mexican delegation in Washington is working in these areas to avoid or reduce export taxes and thus give some breathing room to companies on this side of the Rio Grande.
Of the three issues Mexico intends to address in Washington, one appears decisive for Trump, who will present his aggressive trade policies to the public in the November midterm elections. It is security. “Mexico has been helping me secure the border, but what they have done is not enough. Mexico has not yet stopped the cartels trying to turn all of North America into a drug trafficking playground,” the president said. Trump specifically mentioned fentanyl, the powerful opioid that fuels the overdose epidemic in the US and which has Mexico as one of its main suppliers. The president has not provided any data to support his accusations.
One of the few undeniable prides of Sheinbaum's administration since it took office in October is its security results. At least according to its own data. Murders, which reached nearly 100 per day during the term of her predecessor and mentor, Andrés Manuel López Obrador, have fallen to just over 60. They are still many, but fewer than before. Every week, the Security Cabinet, led by the Secretary of State, Omar García Harfuch, reports on a number of operations against drug trafficking, particularly methamphetamine and fentanyl. This administration boasts the largest seizures of the opioid in Mexico's history, such as the 1.5 tons seized from drug gangs in Sinaloa in December.
In a country victim of a tense, polarized political environment, García Harfuch is one of the few figures generating a semblance of consensus. His strategy against crime appears to be starting to yield results, a situation he himself has tried to sell in Washington at various meetings in recent months. Harfuch has a good reputation north of the Rio Grande. He relates well to his interlocutors in U.S. security agencies and has responded subtly to the demands of the White House. When, for example, the Trump administration singled out fuel theft as one of the main sources of income for drug mafias a few months ago, Harfuch refocused his efforts on that issue, with good results.
The presence of the Mexican delegation in Washington portends possible amendments to Trump's decisions in the coming days. This could include a pause in the implementation of tariffs, a mechanism previously used by the Republican, or their complete elimination, as Sheinbaum and her team desire. Otherwise, the future could become complicated for Mexico, which counts the US as its main trading partner. It's not just the increase in taxes on products outside the USMCA, but also tariffs on steel and aluminum, and, above all, on the automotive industry.
