Experts Skeptical About Longevity of Trump’s Mexico Tariffs

Mexican foreign trade leaders caution that the uncertainty surrounding Donald Trump's tariff threats will persist for a considerable period. However, they argue that if implemented on Feb.1, these tariffs are unlikely to last the entire term due to their unsustainable nature.

President Trump has reaffirmed his intention to impose a 25% tariff on Mexico and Canada starting Saturday, though he is still deliberating whether to exclude oil from the tariff list. Francisco González, Chairman, COMCE Financing Committee, noted that during Trump’s first term, 25% tariffs on steel and 10% tariffs on aluminum were introduced in June 2018 but were later lifted in May 2019 due to their impact on integrated supply chains.

"He initially targeted Mexico and Canada, then extended the tariffs to Brazil, Germany, and other nations. The core issue here is the persistent uncertainty. However, we must continue to move forward and maintain our efforts," González remarked.

Regarding Mexico's potential response, Edgar Amador, Deputy Minister of Finance, emphasized that Mexico will carefully assess the trade policy measures that President Donald Trump intends to apply before determining its response. "We will remain composed in the face of the possible tariffs Trump may impose on goods from Mexico. One of the USMCA participants is considering altering certain rules, but we are still unaware of these changes. Once the new regulations are clear, we will respond promptly, engage in dialogue, and take appropriate actions," he affirmed.

González suggested that the country could consider countermeasures, like those taken in the past, such as imposing tariffs on products from US states that heavily support Trump, like Oregon apples.

"While retaliatory tariffs are a possibility, they must be carefully calibrated. A blanket tariff approach is challenging, given that while we are dependent on auto parts, we are even more reliant on corn. Imposing tariffs on corn would be self-destructive, as we import 75% to 80% of it. Certain measures, while necessary, must be implemented strategically, unlike this broad 25% tariff, if it actually comes into effect. I believe it will not, but it will remain a key tool for Trump to exert pressure, as he has done in the past," he explained.

Díaz stressed there is a significant improvement in cooperation among business sectors from each country. "The objective is not to create conflict, but to foster clear communication and build a compelling case … Mexico is vital to both Canada and the United States.”