Mexico Threatens Retaliatory Tariffs After Trump’s Proposal of 25% Import Duties

Tensions are brewing between Mexico and the United States as Mexican President Claudia Sheinbaum pushes back against President-elect Donald Trump’s recent threat to impose a 25% tariff on Mexican goods. The proposed U.S. tariffs, aimed at curbing drug trafficking and illegal migration, have sparked fears of an economic standoff between the neighboring countries.

In a firm response on Tuesday, Sheinbaum warned that Mexico could retaliate with tariffs of its own if Trump follows through on his promise. The tariffs would target products imported from Mexico and Canada as part of Trump’s efforts to penalize what he described as “ridiculous Open Borders.”

“One tariff would be followed by another in response, and so on until we put at risk common businesses,” Sheinbaum said, referencing the integrated supply chains of U.S. automakers operating on both sides of the border.

Sheinbaum defended Mexico’s efforts to stem the flow of migrants and drugs across the border. She pointed out that large migrant caravans no longer reach the border, and that Mexico has taken steps to combat the flow of drugs like fentanyl, which has been linked to the opioid crisis in the U.S.

She also noted that the influx of weapons from the United States into Mexico has complicated the drug problem. “The flow of drugs is a public health and consumption issue in your country’s society,” Sheinbaum said, shifting the focus back to the U.S.

Sheinbaum took aim at the United States’ defense spending, arguing that resources could be better allocated to address the root causes of migration. “If a percentage of what the United States spends on war were dedicated to peace and development, that would address the underlying causes of migration,” she said.

Experts warn that imposing such steep tariffs could have significant economic repercussions for both nations. The U.S.-Mexico-Canada Agreement (USMCA) prohibits unilateral tariffs, and sudden levies could disrupt industries reliant on cross-border supply chains, such as automotive manufacturing.

“It is unacceptable and would cause inflation and job losses in Mexico and the United States,” Sheinbaum stated, echoing concerns from economists.

Despite the strong rhetoric, Sheinbaum expressed a willingness to engage in discussions with the U.S. to find a resolution. “Dialogue is the best path to achieve understanding, peace, and prosperity for our two countries,” she said.

Trump’s tariffs, which he announced in a series of posts on Truth Social, are part of a broader plan to tackle illegal immigration and drug trafficking. However, data shows that border apprehensions are near four-year lows, raising questions about the urgency of such measures.

If enacted, the tariffs could raise prices on a wide range of goods for American consumers, including cars, food, and fuel. With Mexico as one of the U.S.’s largest trading partners, the economic implications of a trade war could be severe.

As both nations brace for what could become a heated economic dispute, Sheinbaum’s assertive stance signals a departure from the conciliatory approach taken by Mexico’s former president, Andrés Manuel López Obrador, during Trump’s first term. Whether Trump’s tariff threats become reality remains to be seen, but the stakes are high for both sides.