EL PASO, Texas (Border Report) – On the day stock markets cratered around the world after President Donald Trump announced sweeping import tariffs, Claudia Sheinbaum was smiling.
“In the case of Mexico, there are no additional tariffs … and that is good for the country,” Sheinbaum, the president of Mexico, said on Thursday. “This has to do with the good relationship (the U.S. and Mexico) have built based on respect, sovereignty, coordination and cooperation.”
Trump on Wednesday hit countries around the world with tariffs on products they export to the United States that ranged from 10% to nearly 50%. Mexico and Canada weren’t part of the conversation on Wednesday, although they still face specific levies announced last month.
“We are in a new global economic structure in which Mexico has the best conditions,” Finance Minister Marcelo Ebrard said during Sheinbaum’s daily online news conference. “It is cheaper today to produce in Mexico and export (to the U.S.) than it was yesterday. One-hundred and eighty-five countries that compete with us now have more difficult conditions.
“Something else very important is that the treaty survived. […] the products that fall under the US-Mexico-Canada Agreement are exempt – they have zero percent (tariffs) – except for automotive.”
Ebrard showed a graphic claiming 10 million Mexican jobs in industries like agriculture, manufacturing, textile and electronics would be spared from the effects of Trump’s tariffs under the USMCA.
He also said Mexico will continue negotiating with Trump to lower 25% tariffs on auto exports, aluminum and steel.
In El Paso, some business leaders concurred that the 2020 USMCA trade deal continues to provide at least some certainty to the binational business community.
“I am pleased that the USMCA has secured a temporary exemption from these newly announced tariffs, highlighting the essential role of North American trade,” said Jon Barela, CEO of The Borderplex Alliance. “However, I strongly urge the administration to pursue a more permanent resolution to ensure lasting stability for our economy.”
Jerry Pacheco, president and CEO of the Border Industrial Association, concurred the White House mentioned products that comply with the USMCA won’t be affected by Wednesday’s tariffs.
But he said the “chaos on top of a previous chaos” generated by Trump’s on-again, off-again tariff announcements will make America’s trade partners weary and cause costs to rise regardless.
“Unless he rescinds the tariffs in a very short period of time, we are going to see higher prices,” Pacheco said. “Reciprocal tariffs on countries like Vietnam that makes so much of our clothes and Nike shoes and footwear, you are going to see the higher prices. The longer the tariffs are in place, we are going to feel them, and we are going to pay higher prices.”
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