Mexican president warns Trump tariffs will kill jobs, hints at retaliation

MEXICO CITY: Mexican President Claudia Sheinbaum connected Tuesday warned U.S. President-elect Donald Trump of dire economical consequences for some countries from tariffs and suggested imaginable retaliation pursuing his menace of across-the-board tariffs of 25% connected Mexico and Canada.

“One tariff volition travel different successful effect and truthful on, until we enactment our communal businesses astatine risk,“ Sheinbaum said successful a missive to Trump, which she work aloud successful a property conference, informing that tariffs would origin ostentation and occupation losses successful some countries.

Sheinbaum added she would besides question a telephone with Trump and nonstop a missive to Canadian Prime Minister Justin Trudeau.

Trump, who takes bureau connected Jan. 20, said precocious connected Monday helium would enforce a 25% tariff connected imports from Canada and Mexico until they clamped down connected drugs, peculiarly fentanyl, and migrants crossing the border.

Mexico is the United States' apical commercialized spouse arsenic of September, representing 15.8% of full trade, followed by Canada astatine 13.9%. The U.S. is besides Mexico's apical commercialized partner.

“What consciousness is there?” successful escalating cross-border tariffs, Sheinbaum added, underscoring that they would deed peculiarly hard U.S. carmakers with plants successful Mexico, specified arsenic General Motors and Ford.

Mexico's automotive manufacture is the country's astir important manufacturing sector, accounting for implicit 35% of manufactured exports by value. The United States is by acold the ascendant destination for vehicles made successful Mexico, with up to 79% of them heading northbound crossed the border.

Mexico represents astir 25% of each North American conveyance production.

Tariffs could interruption the United States-Mexico-Canada Agreement, a commercialized woody the countries signed successful 2020 during Trump's archetypal administration.

Sheinbaum said her medication had shown Mexico's willingness to assistance combat the fentanyl epidemic successful the U.S., that apprehensions of migrants astatine the borderline were down, and that migrant caravans were nary longer arriving astatine the U.S.-Mexico border.

However, Sheinbaum noted that transgression groups successful Mexico were inactive receiving guns from the U.S.

“We bash not nutrient weapons, we bash not devour synthetic drugs. Unfortunately what we bash person is the radical who are being killed by the transgression that is responding to the request successful your country,“ she said.

“Tariffs are a taxation and would wounded some countries. We volition find a solution,“ said Mexican Economy Minister Marcelo Ebrard, who earlier this period warned Mexico could retaliate with its ain tariffs connected U.S. imports if the incoming Trump medication imposes tariffs connected Mexican exports.

His deputy, Luis Rosendo Gutierrez, said that the tariff threats from Trump were successful enactment with the president-elect's behaviour successful his archetypal term.

“It’s his mode of doing things,“ Gutierrez said successful an interrogation with Radio Formula station. “First, helium takes a truly beardown position, but past helium sits down to negotiate. If helium had conscionable wanted to hike (tariffs), helium would person done it connected (Jan.) 20, helium wouldn’t person fto america cognize successful advance.”

Financial analysts, meanwhile, reacted to Trump's announcement with commentaries ranging from pessimism to cynicism.

At CIBanco, analysts said they believed the menace was a maneuver to unit Mexico, Canada and China into talks, and arsenic these measures would besides harm the U.S. economy, the last effect was apt to beryllium little severe.

The Mexican peso weakened immoderate 2% connected Tuesday, aggravating a steep six-month decline.

Capital Economics economist Giulia Bellicoso said tariffs would apt deed Mexican equities by denting optimism astir nearshoring - a inclination of multinational firms mounting up accumulation facilities successful Mexico - and curtailing investment.

“We expect Trump to commencement different commercialized war,“ she said.

Sheinbaum said she was assured Mexico would scope an statement with Trump but that should the U.S. enforce tariffs, Mexico had a program to bolster its different commercialized relationships.

“We are not lone looking to the north, but besides to the southbound and to the European continent,“ she said. “Mexico is beardown and we volition ever travel retired connected top.”