PLAN D TO RESPOND TO TRUMP’S POLICY AGAINST MEXICO *

Purpose of This Essay

The purpose of this essay is to present it for consideration and to convey a series of civil society proposals to the President of Mexico, Dr. Claudia Sheinbaum, in response to the current challenges facing the country. This is particularly relevant after the Mexican government announced its response to Trump’s policy of sanctions against Mexico and Canada, by imposing tariffs on imports from the U.S.

Before these measures are implemented, we aim to highlight key strategic considerations regarding the President’s policy, its trade implications for Mexico, its bilateral relationship with the U.S., and its short- and medium-term effects on Mexican society.

Strategic Considerations

1. The Mexican Government’s Response is Misguided

The reaction of the Mexican government is not appropriate, as it plays into a retaliatory trade war against the U.S., despite the asymmetrical relationship between both countries—Mexico is up against the hemisphere’s and the world’s largest economic and military power. A tariff war not only dismantles the framework of the Free Trade Agreement but also threatens food security in Mexico, as the country is highly dependent on U.S. agricultural imports (meat, grains, frozen foods, dairy products, etc.). Imposing tariffs will lead to hyperinflation in the local market, making imported products more expensive for Mexicans of all socioeconomic levels.

2. Mexico Should Avoid Tariffs and Use Legal Trade Dispute Mechanisms

As a civil society proposal, Mexico should not impose tariffs on U.S. products, as the main victims would be Mexican consumers. Instead, Mexico should challenge these actions through USMCA trade dispute panels, just as the U.S. did successfully against Mexico over the ban on genetically modified corn imports.

In this context, Mexico and the U.S. are on equal legal footing, and the correct approach is to utilize international legal mechanisms while maintaining diplomacy without escalating political tensions. Resorting to the World Trade Organization (WTO) dispute settlement panels could also be a secondary option to reinforce Mexico’s position.

3. Mexico Must Maintain a Free Trade Stance and Avoid Protectionism

Trump’s economic policy seeks to shift from free trade to extreme protectionism, breaking decades of U.S. trade policy. Mexico should not fall into this protectionist trap; instead, it should become a global leader in free trade, diversifying its trade partnerships and reinforcing supply chains.

Additionally, Mexico should subsidize domestic industries and businesses to enable them to expand into other global markets where Mexico has existing trade agreements. The real damage will be felt by multinational corporations based in Mexico, particularly American and other foreign firms. However, these companies are unlikely to immediately relocate to the U.S. due to the deeply integrated supply chains established since NAFTA’s inception in 1994.

Moreover, U.S. labor costs remain significantly higher than Mexican production costs, meaning that even with the 25% tariff, producing in Mexico may still be cheaper than shifting operations back to the U.S.

4. Mexico Must Acknowledge Security and Drug Trade Issues

The Mexican government must take responsibility for the failure of the previous administration in addressing drug trafficking to the U.S. and the ongoing security crisis. Although American authorities share responsibility for drug distribution within the U.S., Mexico must cooperate on security matters while rejecting any foreign military intervention that threatens national sovereignty.

The best diplomatic strategy is for Mexico to engage in security collaboration with the U.S. without allowing American intervention in its territory, which could otherwise escalate into a military conflict under the guise of fighting terrorism—as Trump’s administration has labeled Mexican drug cartels as terrorist organizations.

5. Trump’s Tariff Policy is a Radical Shift in U.S. Trade Strategy

The 360-degree shift from free trade to extreme protectionism and ultranationalism under Trump’s administration has led to unprecedented retaliatory measures. Many of these are linked to Mexico’s failed immigration policies, which have enabled mass migration facilitated by human trafficking networks, pseudo-human rights organizations, and government complicity.

As a result, Mexico must assume the costs of its inadequate immigration policies, working to contain illegal migration and engaging in proactive diplomacy with the U.S..

Additionally, if the U.S. imposes tariffs on Mexican oil exports as retaliation for migration and drug trafficking issues, Mexico should not impose tariffs on U.S. energy imports (gasoline and natural gas). Given Mexico’s dependence on these imports, retaliatory actions could destabilize the country’s economy and industrial sector, leading to severe economic consequences in the short term.

Conclusion

The Mexican government, its officials, and advisors have failed to anticipate the real threats posed by Trump’s trade policies and have not developed an adequate strategy to handle the situation. Therefore, it is imperative to convince President Sheinbaum not to make reactive decisions influenced by political pressures from Congress but instead to engage in diplomatic negotiations that prevent further escalation.

By maintaining a strategic approach, Mexico can:

✅ Continue benefiting from low-cost imports.

✅ Ensure that the U.S. consumer bears the burden of Mexican export tariffs.

✅ Win legal battles through international trade dispute mechanisms.

✅ Strengthen its export-driven economy by diversifying trade markets.

These proposals are available in video format on our social media platforms.

(*) Author:

Alexis Juárez Cao Romero holds a postdoctoral degree in public policy for the energy sector and multiple master’s degrees in senior management and strategic planning, with additional studies in North American and European affairs from various public and private institutions. He has contributed to the Russian news agency Sputnik, authored two books, published over 30 articles on various topics, and written specialized essays on the energy sector. He has served as an Electoral Advisor for the State of Puebla, held executive roles at private universities, and worked as Business Director in the petroleum sector.