Mexico reaches deal with Trump to avert tariffs for at least a month

MEXICO CITY — Mexico has managed to avoid U.S. tariffs — for now — after its president came to a last-minute agreement with President Trump.

Mexican President Claudia Sheinbaum, in a post on X, said she spoke to the American leader Monday morning and that they came to an accord that delays for at least a month Trump’s threat of 25% tariffs on all Mexican goods imported to the United States.

In exchange, she said Mexico had agreed to reinforce its northern border with 10,000 members of its national guard in order to combat migration and the trafficking of illegal drugs.

Trump confirmed the agreement in a post on Truth Social.

“I just spoke with President Claudia Sheinbaum of Mexico,” he wrote. “It was a very friendly conversation wherein she agreed to immediately supply 10,000 Mexican soldiers on the border separating Mexico and the United States.”

Over the weekend, President Trump announced that heavy tariffs on goods from Mexico, Canada and China would take effect Tuesday, raising the specter of a disruptive trade war that could damage the economies of all three nations and dramatically raise costs for U.S. consumers.

President Trump, shown holding an executive order, had announced over the weekend that heavy tariffs on goods from Mexico, Canada and China would take effect Tuesday.

(Evan Vucci / Associated Press)

Trump signed executive orders placing duties of 25% on imported goods from Mexico and Canada, with a 10% rate on Canadian energy products. Those tariffs would have violated a 2020 free trade pact that Trump himself signed and celebrated as “the fairest, most balanced and beneficial trade agreement we have ever signed into law.”

Trump also imposed a 10% tax on all imports from China.

Trump said the tariffs were necessary because the three countries haven’t done enough to stop the flow of unauthorized immigrants and drugs into the United States. The White House insisted the tariffs would remain in place “until the crisis is alleviated.” Trump repeatedly said that “nothing” would stop him from imposing the tariffs.

Shortly after Trump’s tariff announcement on Saturday, the leaders of Mexico and Canada announced they would respond by slapping retaliatory taxes on U.S. goods. China also said it would “take corresponding countermeasures to firmly safeguard its rights and interests.”

The last-minute deal with Mexico followed a now-familiar Trump script: Make a radical threat — in this case accusing the Mexican government of being in cahoots with drug traffickers — and then announce an 11th-hour accord, saying that the targeted government had caved to Trump’s demands.

A similar scenario unfolded last month with Colombia, which turned back U.S.-bound military flights filled with deportees from the United States, triggering a diplomatic crisis.

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Trump immediately imposed tariffs on Colombian imports to the United States, but soon after declared that Colombian President Gustavo Petro had backed down and agreed to receive military flights with Colombian deportees — something that the Colombian president never publicly agreed to.

Trump’s tariffs against Canada and China were still slated to go into effect Tuesday.

Trump said that he spoke with Prime Minister Justin Trudeau of Canada on Monday morning and planned to do so again in the afternoon.

In a speech on Saturday after Trump announced his tariffs, Canadian Prime Minister Justin Trudeau urged his citizens not to buy American-made products and announced two waves of tariffs against the United States. He questioned Trump’s claims that Canada is to blame for high levels of immigration and America’s fentanyl crisis. “Less than 1% of fentanyl and less than 1% of illegal crossings into the United States come from Canada,” Trudeau said.

In an overview of the tariffs on Mexico, a document released by the White House said “Mexican drug trafficking organizations have an intolerable alliance with the government of Mexico.”

Sheinbaum struck back at that claim, highlighting in a post on X over the weekend Mexico’s gains in the fight against drug traffickers. She said that since she took office four months ago, Mexico has seized more than 40 tons of drugs, including 20 million doses of fentanyl, and has arrested more than 10,000 people linked to organized crime.

She criticized the U.S. for its high levels of drug consumption, urging Trump to do more to combat drug sales, and linked Mexico’s violence to the thousands of firearms being smuggled south from the United States each year.

Sheinbaum vowed Mexico would also retaliate with tariffs on products imported from the U.S., adding: “Problems are not resolved by imposing tariffs, but by talking and engaging in dialogue.”

Mexico is the 13th largest economy in the world and is the second largest in Latin America.

But no country stands to lose more than Mexico in a trade war with the United States.

The U.S. and Mexico trade over $800 billion annually in goods, and the U.S. is the destination of nearly 83% of Mexico’s exports.

Tariffs could devastate Mexico’s already shaky economy, experts say, tipping it into recession. The Mexican peso tumbled to its lowest point against the dollar in nearly three years amid concerns over the tariffs.

“Mexico’s economy is entering uncharted territory as tensions escalate with its largest trading partner,” said Matteo Ceurvels, an analyst at Emarketer, a market research company. For Sheinbaum, he said, “managing this economic rift will be one of the biggest tests of her presidency.”

Experts have warned that destabilizing Mexico’s economy could lead to an increase in organized crime there and cause a wave of migration to the U.S., the two phenomena Trump insists he is trying to combat.

“If Mexico goes into a recession, you’ll see a surge in immigration,” said Joseph Brusuelas, chief economist at the accounting firm RSM US.

Trump had been warning for months that he planned to impose tariffs on imports in a bid to lure manufacturing back to the United States. But he also sees tariffs as a negotiating tactic to extract compromises from other nations on matters that have little to do with trade.

Linthicum reported from Albuquerque and McDonnell from Mexico City. Special correspondent Cecilia Sánchez Vidal in Mexico City and staff writer Don Lee in Washington contributed to this report.