If the Trade War Is Coming, How Would Mexico Fare? Joshua Partlow and David Agren - The Washington Post
go to original January 29, 2017

Mexico Is a Good Partner (Karla Monteverde)

That is the question that has preoccupied politicians and business leaders here since President Trump won the election and began pursuing his agenda to impose tariffs on goods made in Mexico and to build a wall along the border.

Trump has made clear his disdain for the North American Free Trade Agreement, which has governed commerce on the continent since 1994, and Mexican leaders have said that if the terms of the renegotiation did not further their interests, they might walk away, as well.

A trade dispute could have painful repercussions here in Mexico. The country relies heavily on the U.S. market: 80 percent of its exports are sold there, and some economists predict that a trade war could lead to a recession and spur more migration north. Others note that unrest might break out as the country is already tightly wound amid sharp increases in gas prices, the peso devaluation and the unpopularity of its president, Enrique Peña Nieto.

But before that happens, Mexico will sit at the negotiating table with the Trump administration. While the United States is the stronger power, Mexico is not without leverage if this dispute escalates. Top economic officials have already said that Mexico would “mirror” any additional taxes or tariffs that the United States imposes. Former officials have said that Mexico could also tax corporate profits from the many American companies with operations in Mexico.

Outside of the economic realm, Mexico also has plenty of cards to play in negotiations with Trump.

Read the rest at The Washington Post

Related: Mexico’s Ex-President Says Country Is Ready for Trade War with U.S. (Superfan TV)

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