In a recent announcement, The Administration revealed that it would impose 5 percent tariffs on Mexican imports, with the possibility of raising them to 25 percent if Mexico does not halt the flow of illegal immigration, largely from Central America, across the US border.
The proposed action aims to force the Mexican government “to dramatically reduce or eliminate the number of illegal aliens crossing its territory into the United States”, the tariff is to go into effect on June 10th, and to increase each month until October 1st, reaching a maximum of 25 percent.
The announcement caught observers on both sides of the border by surprise and prompted President Andrés Manuel López Obrador to send a diplomat to Washington for mitigation, seeking to diffuse the proposed tariffs. If not curbed, the proposed tariff may leave the United States fighting a multi-front campaign that threatens instability for manufacturers, consumers, and the economy.
This announcement caused a blow to Mexican global stocks and was met with resistance from US business leaders and lawmakers worried about the impact of targeting Mexico, a top trade partner. Such tariffs could push Mexico into a recession, as well as disrupt regional supply chains and hurt investor confidence. The threat may prove to be the biggest foreign policy test to date for López Obrador and a tall order for Mexican authorities already attempting, not only to contain migration but to fight record gang violence.
Tensions at the US border with Mexico have surged in recent months, despite Mexican data showing more deportations and detentions at Mexico’s southern border with Guatemala, consisting mostly of Central Americans trying to reach the US illegally.
López Obrador supports a longer-term, holistic approach focused on improving security, development, and economic opportunity in the migrants’ countries of origin, especially those from Honduras, Guatemala and El Salvador. The bulk of migrants are fleeing widespread violence and poverty in these countries. Many seek asylum in the US when they cross the border.
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