Trump vs Mexico: A new trade war?

The migratory debate has created a rift between Trump and Mexican president Lopez Obrador that could lead to a trading war. Español

democracia Abierta
7 June 2019, 12.01am
Border between Tijuana and the US. Wikimedia Commons.

Andres Manuel Lopez Obrador's (AMLO) presidency in Mexico has been characterised by a series of controversies thus far, and many changes have already taken place even if they are only of a symbolic nature. The conversion of the ex-presidential palace into a cultural centre open to the public, an attempt to cut the salaries of government employees, and the substitution of plans to build the mega-airport in Texcoco for a more modest version in Santa Lucía are just a few examples.

But the new president has an approval rating of 70% and Mexicans are holding out hope that AMLO could represent the change that the country is longing for after decades of conservative governments.

AMLO arrived with the promise of carrying out Mexico's 'Fourth Transformation', a reference to the three well-known and key moments in Mexican history: 1) independence, 2) the separation of church and state, and 3) the revolution.

His desire to structurally change Mexico and challenge the institutions that have perpetuated poverty and inequality have not received a positive reaction from everyone however. The opposition and his political rivals believe that his discourse is often populist, manipulative and is untrustworthy.

He has been frequently criticised for his references to the past rather than focusing on the future, and his constant use of the word 'fifí', meaning a conservative opposed to the president, discredits anyone who doesn't agree with the president and affects the quality of democratic debate.

AMLO must also face several external challenges such as the growth of the right and the hard-right in the region, a migratory crisis aggravated by the phenomenon of migrant caravans, and the Venezuelan crisis that has divided the region and reignited the debate over foreign intervention vs. sovereignty once more.

Although AMLO declared to the press that these new measures are a response to the kidnapping of 22 migrants on a bus in Tamaulipas, his critics believe that he's succumbing to US pressure

Trump continues to use the migratory debate as a smokescreen for internal problems in the US, and his insistence that AMLO must act to stop migratory waves could be about to provoke a trade war between Mexico and the US. This is what you need to know to understand the latest crisis facing AMLO.

AMLO and migration: a contradictory discourse

When he was elected last year, AMLO declared that he would change the relationship between Mexico and Central American migrants drastically, providing migrants passing through Mexico often on the way to the US with work permits.

However, amidst tension with the US government, which has hardened its stance on migration, the Mexican president has followed suit and also toughened his stance. Giving in to pressure, AMLO declared last week that the new system for dealing with Central American migrants will be tougher and there will be far more border controls to the south of the country.

He also changed the emission of the work visa to a transit visa that lasts for 7 days and only allows entry into Chiapas, Campeche, Quintana Roo, Tabasco, and Yucatan, seriously limiting potential migratory routes.

Although AMLO declared to the press that these new measures are a response to the kidnapping of 22 migrants on a bus in Tamaulipas in order to guarantee security for migrants, his critics believe that he's succumbing to US pressure.

It will be difficult for AMLO's reputation to not be negatively affected by what appears to be his submission to the powerful northern neighbour

This contradictory discourse has increased feelings of distrust towards the president, and it shows that his principles are not quite so unmovable as he previously claimed, displaying a Mexico that is unable to stand up to the US to the world.

The US vs. Mexico: a trade war in the making?

Donald Trump stated recently that the US is prepared to impose tariffs on all Mexican goods that enter the country if Mexico doesn't harden its migratory policy.

Mexico must do more to stop this "attack, this invasion of our country" declared Trump. He also claimed that, in spite of the measures that the Mexican government takes, he will go ahead with plans to impose tariffs of 5% next week, that will gradually increase to 25%. Trump, who knows that AMLO lacks the capacity to stop migratory flows, thinks that his position has been too weak and has only attracted more migrants to the American border.

The reality however, is that when faced with the risks of migratory routes, the high cost of coyotes, Central American migrants have changed their strategy and they protect each other amongst caravans, which increases visibility in the press whilst the flows remain stable.

Imposing tariffs of 5% on Mexico would be an economic disaster, but it's in line with Trump's rhetoric of 'America First'. However, AMLO has taken up an amicable approach, stating that he is open to negotiate with the US over potential tariff plans.

If he can't find a solution, he has expressed his willingness to turn to the international courts to appeal the measures, reassuring that Mexico in this case is right and we're certain an agreement can be reached. His Chancellor Marcelo Edrard has been in Washington for various days now and has met with Pence and Pompeo to try to forge a deal.

Despite having the confidence that he'll easily find a solution, it will be difficult that AMLO's reputation won't be negatively affected by what has been perceived as his submission to the powerful northern neighbour regarding a highly sensitive subject. After all, almost 38% of all migrants in the US are from Mexico, followed by Central Americans who make up 6.5% and then India and China with 5% each.

The economic impact of a trade war would be devastating for an economy that is stagnant. AMLO knows this, and has demonstrated so far that the Mexican people are willing to listen to US demands, then change his behaviour as suits him best, as many populists do. Will his approval rating of 70% survive this new crisis?

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