Trump's Cartel Approach Stirs Financial, Sovereignty Concerns

Donald Trump’s decision to designate drug cartels as terrorist organizations is anticipated to have political and financial consequences. Trump explained that this designation addresses cartels' violent campaigns, which have destabilized nations, flooded the United States with illegal drugs, and contributed to widespread criminal activity.

On Jan. 20, Trump signed an executive order classifying Mexican cartels as foreign terrorist organizations, labeling them as a national security threat that surpasses traditional organized crime. The policy seeks to dismantle the operational and command structures of these groups, both within the United States and internationally, to protect US citizens and national security. Within 14 days of the order, the US State Department, in coordination with the Treasury Department, the Attorney General’s Office, and the Department of Homeland Security, will determine which cartels and organizations will be designated.

Experts have raised concerns that the historical precedent of classifying cartels as terrorist organizations could provide Trump with a basis for deploying special forces to target these groups, potentially circumventing the consent of the Mexican government. Sheinbaum emphasized Mexico’s respect for US policies while asserting the country’s firm commitment to defending its sovereignty. "We collaborate, coordinate, and work in partnership, but we will never subordinate ourselves. Mexico is a free, sovereign, and independent nation, and we do not accept foreign interference."

Carlos Rubio Pimienta, Expert in Foreign Relations, Integralia Consultores, explained that the designation will also have strong financial ramifications, granting the US Treasury Department the authority to freeze the assets of financial institutions connected to the designated cartels or their members. "If the Mexican government chooses to cooperate with the US in implementing this strategy and targeting these organizations as terrorist groups, the latter could amend its laws to freeze the assets of businesses or institutions found to be holding financial resources tied to these criminal organizations," Rubio stated.

A study by The Wilson Center warned that classifying Mexican cartels as terrorist organizations would not only impact the cartels but also legitimate businesses and individuals. "Designating these cartels as foreign terrorist organizations could trigger widespread economic instability, affecting not only the cartels but also businesses and individuals in the region." 

Rubio emphasized that the implementation of the decision is yet to be seen, as the move is primarily viewed as a strategic effort to signal to Trump’s supporters that he is addressing the fentanyl crisis. "This designation is largely a media-driven tactic. Trump is aware that it will generate substantial media attention and resonate with his base, showcasing his commitment to tackling the fentanyl epidemic decisively," Rubio explained.