US President Donald Trump granted Mexico a new 90-day extension on Thursday, warning that during that time, the current 25% tariffs on products not subject to the USMCA free trade agreement will remain in effect. He made the announcement, as usual, on Truth, his social network, with a long message published just over 12 hours before the dreaded August 1st, the day on which the unilateral import tariffs imposed by the US president on dozens of countries that have not reached an agreement with Washington during this time are scheduled to go into effect.
Trump wrote that message after a telephone conversation with Mexican President Claudia Sheinbaum, which he described as “very fruitful” because, he added, they both know and understand each other “better.” “The complexities of an agreement with Mexico are somewhat different than with other countries because of the problems and advantages of the border,” the Republican president argued. “We have agreed to extend, for 90 days, exactly the same agreement we had for the previous short period: Mexico will continue to pay a 25% tariff on fentanyl, a 25% tariff on automobiles, and a 50% tariff on steel, aluminum, and copper.”
“Furthermore, Mexico has agreed to immediately eliminate its numerous non-tariff trade barriers,” Trump’s Thursday message continues, “we will be talking with Mexico over the next 90 days with the goal of signing a trade agreement within that timeframe, or even longer.” He did not elaborate on which barriers he was referring to.
Sheinbaum celebrated the agreement she reached with Trump after the 40-minute call, as well as her strategy of non-confrontation with the Republican."We have the best possible agreement, compared to other countries. We have a very good situation; our strategy of a cool head, composure, and a firm defense of our principles has worked," she stated at a press conference at the National Palace.
The Mexican president announced that, in the coming weeks, her government will sign a security agreement with the United States, which will prioritize curbing drug trafficking on both sides of the border. The president assured that this new tariff extension granted by Trump will not entail any additional actions on the part of Mexico."We avoided the tariff increase announced for tomorrow and achieved 90 days to build a long-term agreement through dialogue," she said.
We had a very good call with the President of the United States, Donald Trump. We avoided the tariff increase announced for tomorrow and gained 90 days to build a long-term agreement through dialogue.
— Claudia Sheinbaum Pardo (@Claudiashein) July 31, 2025
I was joined by Juan Ramón de la Fuente, Secretary of…
By then, it was already clear that Mexico had narrowly avoided another tariff blow with unpredictable consequences for its economy. The 25% tariff on Mexican exports outside the USMCA is slightly lower than the 30% Trump had threatened in a letter sent to Sheinbaum in early July.
However, there is a considerable number of products that remain protected by the United States-Mexico-Canada Agreement, signed in 2020, when Trump was president. That pact, which consolidated a free trade zone in North America, is scheduled to be reviewed next year, although since the Republican's return to the White House, it has been under enormous pressure due to its tariff swings and threats to two of its main trading partners, neighbors to the north and south. Trump uses these as an excuse that they are not doing enough to control the trafficking of fentanyl, a powerful opiate that has caused an unprecedented public health crisis in the United States.
Main partner
Despite Trump's tariff wall, Mexico remains the United States' main trading partner, with shipments during the first five months of the year totaling more than $219 billion, a 6% increase compared to the same period in 2024. The Mexican economy has so far withstood Trump's protectionist onslaught. During the second quarter of this year, Mexico's GDP grew by 0.7%, driven by industrial activity and services.
In Trump's tariff crusade, Mexico and Canada were, along with China, the first countries to receive threats of new tariffs, under the guise of halting international fentanyl trafficking. These tariffs came and went, eventually settling at 25% for its northern and southern neighbors, and 20% for Beijing. Trump then announced on April 2nd tariffs of up to 50% for dozens of its trading partners, which he later reduced to a universal 10%, while giving a 90-day period to negotiate. This reversal was influenced by the stock market crash and the fact that the instability threatened to spread to the US public debt.
That truce earned him a nickname that he finds particularly irritating: TACO, an acronym for"Trump always chickens out." Just days before that deadline, he announced a new one: August 1st. So far, the United States has managed to close eight individual pacts with several countries, in addition to a truce, also postponed, with China. The list includes the United Kingdom, Vietnam, Indonesia, Japan, the Philippines, the European Union, and South Korea and Pakistan, the latter two agreements announced this Wednesday.
It must be kept in mind that all of these agreements are, in fact, in principle, agreements, and that many details remain to be finalized. Nevertheless, it must be acknowledged that Trump has managed to change the rules of the global economy in six months, generating previously nonexistent tariff revenue for the United States. It remains to be seen whether these import taxes will have an undesirable effect on inflation when companies begin to pass on price increases to consumers. It also remains to be seen whether this will not end up being the perfect breeding ground for a recession.
The key members of Trump's Cabinet were present for the interview with Sheinbaum: Vice President J. D. Vance, Treasury Secretary Scott Bessent, Secretary of State Marco Rubio, Commerce Secretary Howard Lutnick, U.S. Trade Representative Jamieson Greer, Chief of Staff Susie Wiles, and National Security Advisor Stephen Miller.
Bessent, Lutnick, and Greer have been leading the trade negotiations with dozens of countries, which continue against the clock in the hours remaining before Trump's latest deadline expires. Miller is the architect of Washington's xenophobic policy toward immigrants.
Sheinbaum, for her part, was accompanied by her Secretary of Foreign Affairs, Juan Ramón de la Fuente, the Secretary of Economy, Marcelo Ebrard, and Roberto Velasco, Undersecretary for North America.
