Unfazed by Trump’s tariffs, Mexico hopes for a greater deal – DW – 04/09/2025 | EUROtoday

These days, the environment within the Mexican metropolis of Puebla is a mixture of calm and pressure. In the streets of Mexico’s primary auto trade hub, distributors are promoting their roast rooster from barbecues as at all times, whereas a avenue musician within the background tries to coax just a few cash from passersby along with his efficiency.

On the floor, life appears to be occurring as regular. And but, on at the present time, everybody retains anxiously checking their telephones to listen to the most recent information from the US, the place Donald Trump is about to make his “Liberation Day” announcement of which nation should endure what tariffs sooner or later.

When the updates lastly popped up on folks’s screens, the reduction was palpable. The measures popping out of the White House seemed to be higher than feared for each the town and the nation

A mixture of concern and confidence

In Mexico — a rustic that has fought onerous to earn its fame as a dependable automotive manufacturing hub — public opinion about Trump’s commerce insurance policies, nonetheless, stays divided.

Speaking with DW, economics pupil Fabricio Fernandez says there was “no reason to be afraid,” as a result of “it’s simple — he [Trump] pays the tariffs himself.”

Pensioner Julia, however, was visibly extra involved. She fears for the way forward for Puebla as an automotive middle.

“It’s all very unsettling. For the people, for the country, for everything. When I go to the supermarket, everything is more expensive, and if jobs disappear, things will get even worse,” she informed DW.

Mexico’s auto sector thriving after Trump deal

Thomas Karig remembers Donald Trump’s first time period in workplace throughout which the US president pressured Mexico and Canada to renegotiate the North American Free Trade Agreement (NAFTA) which was lastly substituted by the United States-Mexico-Canada Agreement (USMCA).

The new commerce pact has led to “strong growth among auto parts suppliers in Mexico,” the 71-year-old enterprise marketing consultant primarily based in Puebla informed DW.

Formerly the vice chairman of company relations at Volkswagen in Puebla, Karig attributes this to the share of so-called “regional content” — merchandise made throughout the North American area — which was a US requirement, and which has since elevated by 20.5% proportion factors to a complete of 75%.

“You could definitely say the renegotiation turned out to be a success story for both the US and Mexico,” Karig mentioned.

After preliminary fears of an enormous tariffs blow to the Mexican economic system have subsided, Mexico’s Economy Minister Marcelo Ebrard additionally confirmed himself to be extra assured in a current interview with native radio station Radio Formula.

Donald Trump’s “restructuring of global trade” may really be a significant alternative for Mexico, he mentioned.

“What we saw yesterday was the birth of a new trade and likely also a geopolitical order. One phase is over, and another has begun,” Ebrard said.

Mexico is in a robust place, he added, due to the USMCA pact that was “still in place,” and “extremely valuable for Mexico.”

“We don’t have any reciprocal tariffs. A large portion of our foreign trade — handled through the USMCA — is tariff-free. That’s very good news.”

USCMA on the desk once more

Thomas Karig even believes that Trump would possibly search one other renegotiation of the commerce phrases with Mexico with the purpose of “further strengthening regional content.” He argued that Mexico had “done well with its measured approach” to this point.

“Sure, Mexico could retaliate with tariffs on US products,” Karig famous, “but the question is whether that would really make sense or be productive.”

After all, he added, tariffs are in the end a tax — one paid both by shoppers or by companies. “And that would really only hurt the Mexican people.”

Business marketing consultant Kenneth Smith Ramos, a former chief negotiator for the Mexican authorities within the USCMA talks, thinks the Trump administration is set to “reopen and renegotiate” the settlement, he informed reporters on the sidelines of the Logistics World trade occasion in Mexico City just lately.

Despite the Mexican authorities’s composed angle towards the commerce insurance policies at present being pursued by its neighbor to the north, information from the nation’s all-important automotive trade is just not all that constructive.

Mexican media outlet Millennium reported just lately that automaker Stellantis determined to halt manufacturing at two of its Mexican vegetation — Saltillo Van and Toluca — following Trump’s announcement of tariffs on imported vehicles. And in response to information portal Aristegui NewsJapanese carmaker Nissan had additionally briefly shut down operations at two of its Mexico vegetation the place business automobiles are made.

On a brighter be aware, Sweden’s Volvo is seemingly planning to spice up its funding in Mexico, in response to Economy Minister Ebrard, in search of to spend $700 million (€639 million) on its plant in Cienega de Flores.

This article was initially written in German.