On Thursday morning, President Claudia Sheinbaum of Mexico spoke with President Trump, in a last-ditch attempt to avert the 25 percent tariffs that Mr. Trump imposed this week on her country’s exports, which would devastate its economy.
For now, it appears to have worked.
On social media, after the two leaders’ call, Mr. Trump announced that he would give Mexico another month. At least until April 2, he said, Mexico will not be required to pay tariffs on anything that falls under the main North American trade pact.
“I did this as an accommodation, and out of respect for, President Sheinbaum,” Mr. Trump wrote in a post on Truth Social. “Our relationship has been a very good one.” He also noted Mexico’s work on curbing illegal migration and fentanyl trafficking.
Ms. Sheinbaum responded in a post on social media: “Many thanks to President Donald Trump. We had an excellent and respectful call.”
“We will continue to work together, particularly on migration and security issues, which include reducing the illegal crossing of fentanyl into the United States, as well as weapons into Mexico,” she added.
In a news conference on Thursday morning, Ms. Sheinbaum said she had shared with Mr. Trump examples of what the government had accomplished, including data that showed a decrease of more than 40 percent in the amount of fentanyl seized by U.S. Customs and Border Protection at the border. “I told him, we’re seeing results,” Ms. Sheinbaum said, adding that she told him tariffs would jeopardize such cooperation. “It wasn’t a threat, none of that,” she added.
The tariffs, according to banks and business leaders, could cause American companies that make products in Mexico to leave the country, in line with Mr. Trump’s stated goal of pressuring those manufacturers to relocate to the United States. The tariffs could lead to the loss of tens of thousands of Mexican jobs, and a contraction of the gross domestic product of more than 2 percent.
Ms. Sheinbaum has spent the week urging calm while emphasizing the gravity of the situation, and saying her government had a plan to respond to tariffs.
On Wednesday, a day before her call with Mr. Trump, she seemed to have recovered from the shock that he was imposing the import duties, which Mexican officials, just days earlier, had appeared confident they could head off in negotiations with the Trump administration. She had shifted into crisis mode, calling this a “definitive moment” for the country and drawing a comparison to the devastating Covid-19 pandemic.
Yes, Ms. Sheinbaum acknowledged, it would bring pain: Around 80 percent of Mexico’s exports go to the United States. But Mexico had withstood worse. The peso dipped on Tuesday, the day the tariffs took effect, but not nearly as much as it had during the pandemic, she said.
She called for patience, suggesting — correctly, it turned out — that things could still change, and struck a defiant tone, saying that Mexico was not about to take tariffs lying down.
“Mexicans are brave and resilient — the people of Mexico are strong, and our economy is doing well,” she said on Wednesday, adding that “there will be no submission.” If need be, she said, Mexico would build its trading relationships with “Canada and other countries” to compensate for a loss of U.S. business.
In the meantime, many Mexican businesses said they were taking their cues from their president and sitting tight but bracing for impact, knowing the seriousness of what could be in store.
“At this point, there are no immediate reactions from exporters,” said Miguel Muñoz, the director for Mexico at Geodis, a global logistics company, who said he had spoken both to customers and to Mexican chambers of commerce, on Wednesday. “They’re waiting to see what the government is going to do.”
He said that exporters were not making big moves yet, including his customers in the retail industry. They had been further encouraged by Wednesday’s announcement that the Trump administration would exempt automakers from the tariffs for a month, and U.S. Commerce Secretary Howard Lutnick’s suggestion earlier this week that Mr. Trump’s tariff plans for Mexico and Canada could still shift, he said.
“It’s business as usual, honestly — considering it’s going to be delayed a month, what’s to say it’s not going to be delayed six months or more?” he said. “At least for this week, exporters will act as if it’s business as usual, whatever it takes. After next week, they’ll figure out what to do.”
Ms. Sheinbaum’s comments on Wednesday, however, suggested that she was preparing for the worst. Whatever her government’s plan, a trade war is likely to hurt the Mexican economy much more than that of the United States.
And while some opted for calm and caution this week, others sprung into action. Government officials and business leaders said they were working together to find ways to adjust, and to tap into alternative markets.
“Of course, this took us by surprise and it was not what we hoped for, but the key word here is adaptation,” said Antonio Hernández, director of economic development in the city of Torreón, around 300 miles south of Laredo, Texas. “We have to move beyond the tragedy and into action.”
That has meant “knocking on doors” in the European Union with virtual meetings, and starting to plan trips to countries like Hungary and Japan to discuss commercial partnerships, Mr. Hernández said. But there are big obstacles to exporting to two of the world’s biggest markets, the European Union and China, experts say, including the difficulty of transporting agricultural goods with short shelf lives and European controls on importing food.
Business leaders were also looking closer to home, Mr. Hernández said, focusing on Mexico’s domestic market as well as other markets in the Americas.
Although local officials and business leaders have already started to scramble for ways to face the new commercial landscape, Mr. Hernandez said that until they knew more about what Mr. Trump and Ms. Sheinbaum will do, they would not know “what the rules of the game will be.”
The automotive industry — which got a temporary reprieve before Mr. Trump announced his decision to delay tariffs on Mexico more generally — warned on Wednesday that the tariffs threatened to destabilize the highly integrated supply chains between Mexico, the United States and Canada.
“The tariffs will have severe repercussions in the region generating inflation, loss of jobs and lower growth for the three countries,” the Mexican Automotive Industry Association and the National Auto Parts Industry said in joint statement with other associations.
In fact, the mere possibility of tariffs is already disrupting trade. The flow of goods heading north to the United States has slowed considerably, and U.S. companies have talked of pulling their operations out of Mexico.
Ms. Sheinbaum’s approval ratings have recently soared above 80 percent, in large part because of what many see as her poised and firm approach to negotiating with Mr. Trump, as well as her actions on other high priorities, like cracking down on drug-trafficking cartels.
The government has also focused on national solidarity, with Ms. Sheinbaum earlier in the week calling for a demonstration in Mexico City on Sunday, when she had also planned to announce Mexico’s response to Mr. Trump’s tariffs.
On Thursday, Ms. Sheinbaum said that the event would still take place, despite the reprieve. By then, she was calling it a “festival,” with musical groups.
“All Mexicans succeeded in attaining this respect for our country,” she said, adding of the event, “I’m going to explain the achievement that this agreement represents — between our governments and our people.”
Mr. Muñoz, the Geodis Mexico director, said that many businesses had taken a wait-and-see approach.
On Thursday, it appeared they were right to do so — although tariffs still loomed on the horizon.
“What the chambers of commerce are applauding is the way the president has handled this,” Mr. Muñoz said. “They’re not moving a finger yet.”
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