Summary
- Mexican
President Claudia Sheinbaum said Trump agreed to extend deadline. - Extension
allows more time to finalize trade, security, and migration deals. - Leaders
had a “brief” and “cordial” phone call last Saturday.
The apparent decision contrasts with Mr. Trump‘s assertion
that he is finished discussing a comparable arrangement with Canada after
Ontario broadcast an advertisement on American television that featured
anti-tariff remarks made by the late former U.S. President Ronald Reagan.
Ms. Sheinbaum reported that she and Mr. Trump had a
“very brief” and “cordial” phone conversation last Thursday
during her daily news conference at the National Palace in Mexico City on
Monday. She claimed that during the discussion, they decided to allow their
officials to continue working until the deadline of November 1st without Mr.
Trump enacting further tariffs.
“We agreed that it was going very well,”
she said.
“We
also agreed that we will speak in the coming weeks to try to close the deal.”
The goal, according to Ms. Sheinbaum, is to come to an
agreement before the U.S.-Mexico-Canada Agreement, or USMCA, is reviewed and
potentially renegotiated later this year or in early 2026.
At first, Mr. Trump gave Canada and Mexico deadlines in July
to negotiate new security and economic agreements with the US. Mr. Trump
increased his tariffs from 25 to 35 percent on the majority of Canadian goods
traded outside of the USMCA after those deadlines were missed. But he set a new
deadline of November 1 and maintained the corresponding duties on Mexico at
25%.
Mr. Trump abruptly “terminated” talks
with Canada over the Ontario ad last Thursday as well. In the one-minute
commercial, Mr. Reagan, a symbol of Mr. Trump’s Republican base, warns that
tariffs will have terrible economic effects.
At the request of Prime Minister Mark Carney, Premier Doug
Ford of Ontario consented to remove the spot. The fact that the commercial
would only be taken down on Monday, after it had already been shown during the
first two World Series games, infuriated Mr. Trump even more.
Both Mr. Trump and Mr. Carney are currently on Asian tours
and will be in South Korea this week for an APEC conference. However, according
to Mr. Trump, he will not be seeing Mr. Carney there or again for “a long
time.”
How would new tariffs affect Mexican exporters and prices?
Mexican exporters, especially those not completely biddable
with USMCA rules, would face increased costs due to tariffs potentially as high
as 25- 30. This could reduce their competitiveness in the U.S. request, leading
to a decline in exports, particularly in sectors like motorcars, energy,
husbandry, and electronics.
The added costs from tariffs would probably be passed on
incompletely to U.S. importers and consumers, driving up prices of goods
imported from Mexico. This includes food products similar to fruits, and
vegetables, as well as artificial goods.
The tariffs could cause a compression in Mexico’s GDP by
reducing import volumes and dismembering business operations, potentially
leading to job losses in import-dependent diligence.
