The US has threatened tariffs on Mexican goods, but Mexican President Claudia Sheinbaum has assured her country that contingency preparations are already in place.
Sheinbaum said during a Monday press conference that Mexico was ready for whatever the US government decides about trade and security issues, as per a Reuters report.
As chatter rises, the Mexican government is ready to deal with the economic consequences that lie ahead.
“We have a plan B, C, and D”, said Sheinbaum during the conference.
Recent diplomatic engagement
With tensions simmering, Mexican officials held a series of meetings with their US counterparts in Washington late last week to discuss trade and security issues that have come to dominate the chase for Trump’s attention.
The meetings were described as “cordial,” and both sides appeared to be bending in the wind toward proximity, albeit stressed by drug trafficking and immigration policies.
These tensions have strained the bilateral relationship. Sheinbaum reported strong coordination with the US, which might be a positive sign for the discussions.
President Donald Trump has cited increasing fears regarding drug trafficking, especially fentanyl, as one of the main reasons for his tariff threat.
He has said that both Mexico and Canada have not done enough to combat these issues.
The economic impact of the tariff
Trump initially announced broad tariffs on key trading partners in February, accusing them of failing to prevent illegal immigration and drug trafficking, before pausing the measure.
That suspension is set to expire on Tuesday. Tariffs have serious ramifications for the Mexican and US economies.
The proposed tariffs—reaching up to 25 percent—could disrupt supply chains in critical industries such as automobiles and construction materials, potentially driving up consumer prices.
This, in turn, may complicate Trump’s efforts to fulfill his campaign pledge of reducing the cost of living for households.
Such moves could jeopardize general economic stability in Mexico, a country heavily reliant on exports to the US, putting thousands of jobs in industries which rely on cross-border trade at risk.
Since the US is Mexico’s primary trade partner, any tariffs could significantly impact major businesses and further strain diplomatic ties, already tense due to immigration and drug policy disputes.
Tensions with neighbours
During the trade talks, the US-Mexico relationship also depends a great deal on security cooperation.
Trump’s administration has called for stricter measures on drug smuggling and immigration, while Sheinbaum maintains that Mexico is taking these issues seriously.
Over the weekend, US Commerce Secretary Howard Lutnick told Fox News that while Mexico and Canada have made some progress in addressing Washington’s border concerns, they would still be subject to tariffs.
Canadian Prime Minister Justin Trudeau emphasized that less than one percent of fentanyl and undocumented migrants entering the US come through the Canadian border.
On Sunday, he stated that Ottawa would continue efforts to prevent new tariffs this week but warned that Canada would “have a strong, unequivocal and proportional response” if they were imposed.
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