Trump calls off tariff threats on Mexico

Tensions over tariffs threatened by US President Donald Trump against Mexico have receded following a deal between the two countries on Friday.

The Trump administration had said it would impose a 5 percent import tax on all Mexican goods from Monday unless Mexico did more to stem the flow of illegal migrants. Calling the surge in migrants an “invasion,”, President Trump had threatened to keep raising duties up to 25 percent unless Mexico addressed the problem.

The arm-twisting by the United States of its tiny neighbor to the south appears to have worked, with Mexico now agreeing to expand a contentious asylum program and beef up security to hinder the flow the illegal Central American migrants to the United States.

In a joint declaration following three days of talks in Washington, the two sides said that Mexico would immediately expand along the entire border a program that sends migrants seeking asylum in the United States to Mexico while they await adjudication of their cases.

Under the deal, Mexico will also increase its efforts to stop illegal migrants from Central America traveling through Mexico to the United States. Those measures will include deploying the militarized National Guard security force to its southern border.

However, the deal fell short of a key US demand that Mexico accept a “safe third country” designation that would have forced it to permanently take in most Central American asylum seekers. Mexican Foreign Minister Marcelo Ebrard said in Washington his team had also resisted US requests to send deported Guatemalans to Mexico. He said he was satisfied with the deal. He also highlighted US support in the agreement for a Mexican proposal to jointly address underlying causes of migration from Central America.

From January, when the program began, until the first week of June a total of 10,393 mostly Central Americans had been sent back to Mexico. In the month of May alone, the US border officers apprehended more than132,000 people crossing from Mexico to the US, which was the highest monthly level since 2006.

Frustrated by a recent surge of migrants that has overwhelmed US resources on its southern border and in a bid to pressure Mexico into making concessions, Trump had threatened to use import tariffs on all Mexican goods. President Trump has made reducing illegal immigration a cornerstone of his presidency and it is certain to be a key issue in his re-election bid next year.

For its part, Mexico had prepared a list of possible retaliatory tariffs targeting products from agricultural and industrial states regarded as Trump’s electoral base, a tactic China has also used with an eye toward the Republican president’s 2020 re-election bid.

Business groups and even some close Republican allies were reportedly unhappy with the prospect of tariffs on the top US trade partner, saying they would damage the economy. Duties on Mexico would also have left the United States fighting trade wars with two of its three largest trading partners, and would further unnerve financial markets already on edge about a global economic slowdown.

Economists have said that trade disputes with large trading partners could damage supply lines and pinch consumers at a time when the global economic expansion has started to sour and the risk of recession has risen. Even the United States, one of the more solid performers on the economic stage, would not be immune to the downdraft.

Letter from Mexican President Andrés Manuel López Obrador to US President Trump