Mexico girds for talks on 'counterproductive' Trump tariff threat

[WASHINGTON] Mexico's Foreign Minister Marcelo Ebrard warned on Monday that President Donald Trump's planned punitive tariffs on Mexico would be "counterproductive" for cracking down on migrants, but the White House reiterated Mr Trump's threat is serious.

As markets reeled, officials on both sides said they thought a deal could be reached before potentially-damaging tariffs on Mexican exports to the United States are put in place on June 10.

Mr Trump, on a state visit to Britain, stepped up pressure in a tweet.

"As a sign of good faith, Mexico should immediately stop the flow of people and drugs through their country and to our Southern Border," he wrote.

Earlier, President Andres Manuel Lopez Obrador said in Mexico City that it was important to resolve the issue "through dialogue."

"We are in favour of free trade, and we think an agreement can be reached," he said.

"I want to continue being friends with President Donald Trump."

MEXICO STUNNED BY TRUMP THREAT

Mr Trump stunned Mexico on Thursday announcing that the United States would place duties on all imports from Mexico, beginning at five per cent on June 10 and rising to as high as 25 per cent, unless Mexico City took action to halt the hundreds of thousands of migrants crossing into the US from Mexico in recent months.

The announcement pummelled the Mexican currency and sent markets in both countries tumbling over fears of a sharp slowdown in trade and high prices for imported goods in both sides of the border.

Economists warned that the Mexican economy could be pushed into recession if Mr Trump followed through, and there were worries that it could also affect US growth.

Mr Ebrard and other top officials flew to Washington in panic mode Friday after Mr Trump's announcement.

He was expecting to meet this week with Homeland Security Acting Secretary Kevin McAleenan and also with Secretary of State Mike Pompeo.

Mexico's agriculture minister and economy minister were planning to meet with their counterparts in the Trump cabinet.

'ECONOMIC INSTABILITY'

Mr Ebrard told reporters that Mexico had already prevented 250,000 migrants from traveling to the US border, and that the only solution to the crisis is a comprehensive development plan for Guatemala, El Salvador and Honduras, where most of them come from.

"Slapping tariffs, along with the decision to cancel aid programs in the northern Central American countries, could have a counterproductive effect and would not reduce migration flows," he said.

Mr Trump in March cut off aid to El Salvador, Honduras and Guatemala, insisting they weren't doing enough to stop the flow of migrants to the United States. He has also more than once threatened to close the US border with Mexico.

Mr Ebrard said the tariffs would "cause financial and economic instability," making it even harder for Mexico to address the migrant movements.

He argued that Mexico had already taken numerous steps under US pressure to slow the flow northward.

Those included letting US asylum seekers remain in Mexico while their applications are reviewed, and also accepting applications for asylum in Mexico itself from more than 24,000 people.

"Without Mexico's efforts, an additional quarter-million migrants would arrive at the US border in 2019," he said.

US: STOP MIGRANT BUSES

Kevin Hassett, chairman of the White House Council of Economic Advisers, said Mexico had to take more action, including stopping buses that ferry migrants to the US frontier, which the Trump administration claims are run by criminal gangs.

"The fact is there are a lot of identifiable steps... that the Mexicans could be taking but haven't been, in terms of stopping the organised crime folks from running buses to get people up to the border and so on," he told CNN.

Mr Hassett, who Mr Trump announced late Monday would be leaving his position, told reporters that Mr Trump is "100 per cent not" bluffing, and will follow through if there's no action by Mexico.

"This is much more harmful for the Mexican economy than the US economy," he said.

"If they can come forward with a good plan, then the tariffs won't happen."

MEXICO: AID, NOT TARIFFS

Mr Ebrard criticised the US for cutting former aid programmes to Central America and not following through with a new US$5.8 billion public and private aid and investment plan that the Department of State announced in December.

"We don't have today a single programme in place, so we are going to put this on the table, too," Mr Ebrard said.

He rejected the proposal mentioned by top Trump officials that Mexico, as the first country the migrants enter, agree to accept all of their asylum claims.

That would "not be acceptable for Mexico," he said.

AFP