As the ink dried on the edict removing U.S. import tariffs from Mexican and Canadian steel and aluminum, U.S. President Donald Trump stunned NAFTA traders May 30 with the announcement of a major new trade war against Mexico. The program calls for implementation as of June 10 of a 5% import tariff on “all goods imported from Mexico”, with the stipulation that the duty rate will rise by five percentage points per month up to 25%. The tariffs are intended to force Mexico to stop the flow of migrants to the U.S. border, according to the president’s tweet. Mr. Trump has not yet released his plan to impose tariffs on FIFA to boost the USMNT’s ranking or punitive duties on the Kingdom of the North for intemperate behavior, but we presume these are on his ink blotter as we type. Continue reading Yeeee Haw, more tariffs!
Now that the United States is loudly breaking up with Mexico on social, Mexico is suddenly on the prowl for hot rebound trade with other markets. This is how it looks from here anyway, with Mexican officials popping up all over the media saying some country or other is going to be a big new market for Mexican exports. The new U.S. administration’s threats to dismantle the North American Free Trade Agreement (NAFTA) are currently stoking the flames of economic terror in Mexico, but we all know that Mexico’s dependency on the U.S. export market has been the stuff of economists’ nightmares for decades. To put it in perspective, the share of Mexico’s annual exports shipped to the USA has not dropped below 79% since some time before 1993, if it ever has. From 1998 to 2001, the concentration of Mexican exports destined for the U.S. market hovered near a truly bloodcurdling 89%. So it’s not like we didn’t know we were exposed to risk from overdependence on one market, but after 25 years of trade-loving U.S. governments, we became accustomed to living in denial. Continue reading Mexico frantic to diversify export markets for some reason