Trump’s tariffs would ‘screw up’ key relationships with Canada, Mexico: Biden

Trump’s tariffs would ‘screw up’ key relationships with Canada, Mexico: Biden

U.S. President Joe Biden on Thursday said he hoped president-elect Donald Trump would rethink his plan to impose tariffs on Mexico and Canada, saying it could “screw up” relationships with close allies.

“I hope he rethinks it. I think it’s a counterproductive thing to do,” he told reporters in Nantucket.

“We have a unusual situation in America. We’re surrounded by the Pacific Ocean, the Atlantic Ocean, and two allies: Mexico and Canada. The last thing we need to do is begin to screw up those relationships.”

Trump on Monday said he would impose tariffs on Canada and Mexico when he takes office in January until they clamped down on drugs and migrants crossing the border, a move that would appear to violate the U.S.-Mexico-Canada free-trade deal.

Such a move would throttle the Canadian economy. 

Trudeau, Sheinbaum speak to Trump

In a phone call after Trump’s post, Prime Minister Justin Trudeau listed things Canada has already done to improve the situation at the border and suggested Canada’s situation wasn’t as dire as Mexico’s.

Trudeau said his conversation with the president-elect as a “good call” during which he laid out the “facts.”

Mexico’s President Claudia Sheinbaum said on Thursday she did not specifically discuss tariffs in a call she held with Trump on Wednesday.

Following the call on Wednesday, Trump said Sheinbaum had “agreed to stop migration through Mexico, and into the United States, effectively closing our Southern Border.”

Sheinbaum, however, said she had laid out a strategy that “attended to” migrants before they reached the U.S. border. “Mexico’s stance is not to close borders, but to build bridges between governments and their peoples,” she said in a post on X after Trump’s post.

Published at Thu, 28 Nov 2024 17:49:57 +0000

Mexico steels itself for the return of a hostile President Trump

Mexican President Claudia Sheinbaum got a foretaste of what dealing with Donald Trump’s return to the White House will be like on Wednesday night, when she was forced to correct what appeared to be Trump’s mischaracterization of their first conversation.

On Wednesday afternoon, Sheinbaum tweeted that she’d had “an excellent conversation with President Donald Trump. We talked about the Mexican strategy on the migration phenomenon, and I shared with him that migrant caravans are no longer arriving at the northern border because they are dealt with in Mexico.

“We also spoke about reinforcing collaboration on security within the framework of our sovereignty, and about the campaign we are undertaking in the country to prevent the consumption of fentanyl.”

Shortly after, Trump took to his own social media channel Truth Social and posted that Sheinbaum had “agreed to stop Migration through Mexico, and into the United States, effectively closing our Southern Border.”

Compelled to tweet again, Sheinbaum said that in her phone call with Trump, she “explained the integral strategy Mexico has followed to deal with the migratory phenomenon, respecting human rights.

“Thanks to that, migrants and caravans are dealt with before they reach the (U.S.-Mexico) border. We reiterated that the posture of Mexico is not to close borders but rather to build bridges between governments and peoples.”

Notes of defiance

Sheinbaum had already struck a note of defiance in her response to Trump’s threat of heavy tariffs.

At her Tuesday news conference, she read aloud the letter she would later send in reply. In that letter, she left no doubt about Mexico’s plans to retaliate.

“One tariff will follow another in response, and so on until we put our common businesses at risk,” she warned. “What sense is there?”

In her letter, Sheinbaum also appeared to criticize U.S. policies that she said aggravated problems for both countries.

In response to Trump’s charge that Mexico isn’t doing enough to stop migrants, Sheinbaum wrote: “If a percentage of what the U.S. spends on war were instead dedicated to the construction of peace and development, that would address the underlying causes of human movement.”

Sheinbaum’s reaction to Trump’s tariff threat was more combative than that of Prime Minister Justin Trudeau, said former Mexican deputy trade minister Juan Carlos Baker, a leading member of the Mexican team that renegotiated NAFTA between 2016 and 2018.

Baker told CBC News that, “at least on the surface,” the response from Sheinbaum and Mexican Secretary of the Economy Marcelo Ebrard has been “starkly different from what the Canadian position has been.”

“Mexico is following a strategy where we clearly establish that Mexico is not going to be pushed around,” Baker said. “That some of the most radical ideas and the most — quite honestly — appalling comments made by Donald Trump about my country are just not true.”

‘There are no more migrant caravans’

President Sheinbaum suggested in her remarks Tuesday that Trump was ignorant of what is really happening at the U.S.-Mexican border, where illegal crossings have fallen precipitously.

“You are probably not aware that Mexico has developed an integral policy of attention to migrants from different parts of the world who cross our territory en route to the southern border of the USA.

“As a result, and according to figures of the Customs and Border Patrol of your own country, encounters on the U.S.-Mexican border have fallen by 75 per cent from December 2023 to November 2024 …

“Half of those who arrive come with an appointment legally authorized by the U.S. program called CBP1; for this reason there are no more migrant caravans arriving at the border.”

Turning to what she called the U.S. “fentanyl epidemic,” Sheinbaum said that “it is a problem of consumption and public health in your country.”

She pointed to legislation her government has introduced to stiffen penalties and remove the option of bail for people accused of manufacturing, or dealing in, synthetic drugs.

“However, she continued, “it is publicly known that the chemical precursors [of fentanyl] enter Canada, the United States and Mexico illegally, coming from Asian countries, for which reason international collaboration is urgently needed.”

Sheinbaum also raised one of Mexico’s longstanding grievances against the U.S.: the fact that criminal cartels in Mexico kill and terrorize with guns purchased mainly in the United States.

“You must also be aware of the illegal traffic of arms that enter my country from the United States; 70 per cent of illegal arms seized from criminals in Mexico come from your country,” she said Tuesday.

“We don’t produce the guns, we don’t consume the synthetic drugs, however we sadly provide the dead killed by criminals to respond to your country’s demand for drugs.”

Sheinbaum also announced that she would be writing to Trudeau. Although that letter has not yet been sent, she gave some indication of the message she would convey as some Canadian politicians are speculating about making a deal with Trump that excludes Mexico.

Premier Doug Ford of Ontario said that “to compare us to Mexico is the most insulting thing I have ever heard from our friends and closest allies, the United States of America.”

Denying U.S. and Canadian claims that Mexico could become a “back door” for Chinese electrical vehicle sales into the rest of North America, Sheinbaum pointed out that Canada allowed the importation last year of $1.6 billion US worth of Chinese EVs, which she called “exponential growth.” Mexican imports, she said, “were far smaller.”

She added that, since 2006, the U.S. and Canada have invested about sixty dollars in Mexico’s auto industry for every dollar that China has invested.

“Of course Mexico has a relationship with China,” she said, “but we privilege our relationship with those places where we have a free trade treaty.”

‘Not a back door’

Past and current Mexican officials have mostly backed Sheinbaum’s position and have resisted efforts to force their country to choose between trade with China or trade within North America. Mexico still believes it should be able to have both.

Mexican officials also have taken issue with claims that their country serves as a gateway for Chinese products to flood North America without restriction.

“It’s not a fair characterization,” said Jorge Guajardo, who has served as both Mexican consul in the United States and as Mexico’s ambassador to China.

“First of all, Mexico imposes tariffs on most Chinese imports that are of concern,” Guajardo told CBC News’ Rosemary Barton Live.

Sheinbaum also cited Mexico’s decision to impose tariffs of 25 per cent on Chinese EVs back in August 2023. Mexico has not imposed the same 100 per cent tariffs introduced since by the U.S. and Canada.

She said Mexico also slapped tariffs on Chinese steel and aluminum manufactured goods on its own initiative in April.

Guajardo told CBC News that much of the panic around Chinese EV companies flooding into Mexico is based on misunderstandings.

“There’s been a lot of announcements of Chinese companies wanting to invest in Mexico. Most of them were invited by Tesla,” he said, referring to the electric car company owned by prominent Trump ally Elon Musk.

“Tesla suspended its plans to build its plants in Mexico. And to my understanding, all those announcements, none of them have come to completion or been acted upon.

“So as we stand, China is not in the top ten countries with foreign direct investment in Mexico. And I think it’s important that we understand that China invests in Canada considerably more than they invest in Mexico. So no, Mexico is not an outpost for China to enter the [North American trade] zone.”

Guajardo said that while Mexico lags behind the U.S. and Canada in auto tariffs, Canada is the laggard when it comes to blocking Chinese petrochemicals and plastics, which face more barriers in the U.S. and Mexico than in Canada.

“So I think (the Canadians) are just bringing to the fore industries that they want to bring attention to, and sort of hide others that they don’t want to bring attention to,” he said.

Guajardo said the three countries should instead collaborate on a common approach to China, which probably would include stiffer Mexican tariffs on Chinese autos and auto parts.

“We’re back to the future. I think we had this conversation six years ago, when [the Canada-United States-Mexico Agreement] was being renegotiated. Same issues,” he said. “We ended up having a three-country agreement. Something tells me it’s going to be again a three-country agreement.

“But we’ll see.”

Mexicans react with calm

Mexicans have certainly not reacted to Trump’s threats with panic. 

The Mexican peso has gained slightly against both the U.S. and Canadian dollar since Trump’s tariff tweet, and the Mexican stock exchange (BMV) index is slightly higher than it was a week ago. Guajardo said Mexicans tend to see the threat as “more of a negotiation tactic rather than a very firm decision by Trump to impose tariffs.

“There’s also a consensus in Mexico that the tariffs that Donald Trump is threatening will be devastating for the U.S. economy itself, given how inflation has been behaving lately and the fact that Mexico is the U.S.’s largest trading partner.”

Although the balance of trade skews toward Mexico, U.S. exports to Mexico are worth about $453 billion Cdn annually.

Baker said Mexicans feel they have been down this road before.

“I have a very strong sense of deja vu in all of this because, you know, Donald Trump used to negotiate on the media,” he said. “We never really were quite sure how to, what to expect from the U.S. positions. And it was also very common to have something announced or highlighted one day, just for the president to change his mind the day after that.”

What the Mexican government learned from dealing with the first Trump administration, he said, was that “we needed to be very intelligent, that we needed to be very strategic, that we also had a lot of care in deciding which battles we were going to pick and which ones we were just going to let pass.

“Because you know, it’s going to be a very long period ahead of us. Four years of Donald Trump.”

Published at Thu, 28 Nov 2024 17:47:53 +0000