The United States will not place new tariffs on all goods coming from Mexico, President Trump said on Twitter Friday evening, ending another markets-rattling episode of his brinksmanship.
In his post, Trump announced that his administration had reached a deal with the Mexican government to curb the flow of Central American migrants across the US border.
“The Tariffs scheduled to be implemented by the U.S. on Monday, against Mexico, are hereby indefinitely suspended,” Trump wrote.
I am pleased to inform you that The United States of America has reached a signed agreement with Mexico. The Tariffs scheduled to be implemented by the U.S. on Monday, against Mexico, are hereby indefinitely suspended. Mexico, in turn, has agreed to take strong measures to….
— Donald J. Trump (@realDonaldTrump) June 8, 2019
He telegraphed the breakthrough earlier on Friday when he also suggested that a deal with Mexico would include further concessions on trade, in addition to the ostensible purpose relating to immigration.
“If we are able to make the deal with Mexico, & there is a good chance that we will, they will begin purchasing Farm & Agricultural products at very high levels, starting immediately,” he tweeted Friday morning.
If we are able to make the deal with Mexico, & there is a good chance that we will, they will begin purchasing Farm & Agricultural products at very high levels, starting immediately. If we are unable to make the deal, Mexico will begin paying Tariffs at the 5% level on Monday!
— Donald J. Trump (@realDonaldTrump) June 7, 2019
The decision not to put tariffs on Mexican imports opens the door to the possible ratification by lawmaker in the US, Mexico and Canada of the renegotiated North American Free Trade Agreement. But despite the fact that one obstacle to putting the deal, renamed the US-Canada-Mexico Agreement, into effect has been removed, Democratic lawmakers in the US have said they will not approve it.
Many economists and political analysts assumed Trump would try to avoid the tariffs, which when added on top of existing and threatened future tariffs on China could have pushed the US economy closer to recession territory during his re-election campaign.
But even without having followed through, the unprecedented move to use a national emergency declaration to pressure Mexico on both immigration policy and trade, shortly after having negotiated a new trade agreement, has raised questions about other trade relationships.
In particular, reports indicated that leaders in Beijing were wary of striking any deal with the United States that allowed Washington to unilaterally re-impose tariffs. Trump’s decision to invoke a 1970’s national security law to schedule new tariffs on Mexico after having already signed a trade agreement sends a clear signal that no deal would preclude additional tariffs coming in the future.