The United States has announced it will not increase the tariffs it imposes on its southern neighbour, Mexico, after a call with the country’s president, Claudia Sheinbaum.
Her counterpart, US President Donald Trump, broke the news on his Truth Social platform on Thursday, touting the decision as a diplomatic breakthrough.
“I have just concluded a telephone conversation with the President of Mexico, Claudia Sheinbaum, which was very successful in that, more and more, we are getting to know and understand each other,” Trump wrote.
“The complexities of a Deal with Mexico are somewhat different than other Nations because of both the problems, and assets, of the Border.”
He explained that he and Sheinbaum had agreed to keep US tariffs at their current rates for a 90-day period.
Mexico had been one day away from seeing a tariff increase on August 1. Earlier this month, on July 11, Trump had threatened on Truth Social to hike tariffs on Mexican imports to 30 percent.
That threat was part of a series of individualised tariff announcements, published online in the form of letters to US trading partners. One country, Brazil, was slapped with tariffs of 50 percent.
In his letter to MexicoTrump blamed the country for allowing the synthetic opioid fentanyl to cross into the US and for failing to tamp down on criminal cartels that he accused of “pouring these drugs into our country”.
“Mexico has been helping me secure the border, BUT, what Mexico has done, is not enough,” Trump wrote.
“Mexico still has not stopped the Cartels who are trying to turn all of North America into a Narco-Trafficking Playground. Obviously, I cannot let that happen!”
The threatened 30-percent tariff was the same rate initially assigned this month to the European Union, which likewise negotiated a deal with Trump over the past week.
As a result of Thursday’s announcement, the US will continue to impose a 25-percent tariff on cars made in Mexico and 50 percent on its steel, aluminium and copper products.
There is also a 25-percent tax — which Trump has dubbed a “fentanyl tariff” — on any Mexican imports not covered by an existing free trade accord, the US-Mexico-Canada Agreement (USMCA).
“Additionally, Mexico has agreed to immediately terminate its Non Tariff Trade Barriers, of which there were many,” Trump wrote on Thursday.
“We will be talking to Mexico over the next 90 Days with the goal of signing a Trade Deal somewhere within the 90 Day period of time, or longer.”
Sheinbaum herself posted a message summarising their call, albeit a shorter one, emphasising continued talks between their two governments.
“We had a very good call with US President Donald Trump,” Sheinbaum wrote. “We avoided the tariff increase announced for tomorrow and secured 90 days to build a long-term agreement through dialogue.”
Trump had put in place an August 1 deadline for the tariff hike, but he has announced a series of deals in the lead-up with countries including South Korea, Japan and Indonesia.
Those deals have not avoided tariffs altogether but rather have resulted in lower import taxes than the initially announced rates.
Trump has sought to leverage tariffs to encourage domestic manufacturing and reduce what he considers undesirable deficits with US trading partners.
He has also used them to advance domestic policy priorities, including by pressuring neighbouring countries like Mexico to beef up border enforcement.
Experts have warned, however, that tariffs on goods imported in to the US could result in higher prices for consumers. Trump’s start-and-stop approach to tariffs — announcing them, only to delay them — has also spurred fears of instability in the economic markets.
Initially, Trump had unveiled individual “reciprocal” tariffs on foreign trading partners in April. Those tariffs were delayed, and their latest iterations unveiled this month.
Trump, however, has brushed aside concerns, saying his tariff campaign will bring the US billions in taxes.
“I always say ‘tariffs’ is the most beautiful word to me in the dictionary,” Trump said in January, ranking as one of his favourites, behind terms like “love” and “religion”.
“Tariffs are going to make us rich as hell,” he added.
