Mexican President Claudia Sheinbaum suggested that Mexico could retaliate with tariffs of its own, after U.S. President-elect Donald Trump threatened to impose 25% import duties on Mexican goods

Mexican President Claudia Sheinbaum suggested Tuesday that Mexico might impose retaliatory tariffs if U.S. President-elect Donald Trump follows through on his threat to levy 25% import duties on Mexican goods. Trump has warned of these tariffs unless Mexico curbs the flow of drugs and migrants across the border.

Sheinbaum expressed a willingness to engage in dialogue but emphasized that drug issues are primarily a U.S. problem. “One tariff would provoke another in response, creating a cycle that risks endangering shared industries,” she said, highlighting the interconnected operations of U.S. automakers with facilities in both countries.

Sheinbaum noted that Mexico has made significant efforts to manage migration, stating, “Caravans of migrants no longer reach the border.” However, she acknowledged challenges in combating drugs like fentanyl, which is manufactured by Mexican cartels using precursors from China. She also pointed to the U.S. as the source of a smuggled weapons influx into Mexico, framing drug-related issues as stemming from public health and consumption problems within American society.

Criticism of U.S. Policies

Sheinbaum criticized U.S. spending priorities, arguing that funds allocated to military efforts could be better invested in regional development to address the root causes of migration. “If even a fraction of what the U.S. spends on war were redirected toward peace and development, we could tackle the core issues driving migration,” she stated.

A Different Kind of President

Sheinbaum’s firm stance marks a sharp contrast to the approach of her predecessor, Andrés Manuel López Obrador, who cultivated a cooperative relationship with Trump during his first term. López Obrador negotiated a deal to curb migration in exchange for Trump withdrawing tariff threats.

In contrast, Sheinbaum, a staunch leftist with roots in student activism, appears less inclined to appease Trump. “We negotiate as equals. There is no subordination here because we are a great nation,” she said, while expressing optimism about reaching an agreement.

Risks of Escalation

Gabriela Siller, an economist with Banco Base, cautioned that the clash of personalities between Sheinbaum and Trump could escalate tensions. “Trump may have tossed the threat out casually, as he often does,” Siller said. “But Mexico’s assertive response, signaling readiness for counter-tariffs, could provoke him to act.”

It remains uncertain how serious Trump’s tariff threat is. The U.S.-Mexico-Canada Agreement (USMCA) prohibits unilateral tariffs among member nations, and imposing such duties could disrupt deeply integrated supply chains, particularly in the auto industry. Plants on both sides of the border depend heavily on each other for parts and components, meaning abrupt tariffs could bring some production lines to a standstill.

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