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Trump’s radical second-term agenda set to test Mexico’s fragility

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During his first presidential campaign in 2015, Donald Trump blamed Mexico for taking US jobs while exporting drug traffickers and rapists. But five years later, he had updated the treaty binding their economies and called his Mexican counterpart a “great guy”.

Mexico’s business leaders felt they weathered the first Trump storm relatively well. Some believe President Claudia Sheinbaum can follow the playbook that worked for her predecessor Andrés Manuel López Obrador: don’t criticise Trump and give him what he wants on migration.

But a second Trump administration poses far more serious challenges for Mexico, the biggest trading partner of the US. Business leaders and experts on the bilateral relationship fear that the fledgling Sheinbaum government is not well placed to navigate them.

Trump will be a more powerful president this time, with likely majorities in both houses of Congress, He will be determined to press a harder bargain with his weaker southern neighbour, which is suffering from drug-related violence and sluggish growth.

“Trump redoubled is much more difficult to deal with . . . he is a bully, and [Sheinbaum] is an inexperienced national politician,” said Andrés Rozental, a former Mexican deputy foreign minister. “I get the impression that it’s going to be a lopsided relationship, with the Americans demanding constantly more from Mexico, and Mexico being unable to commit or even to make a major difference.”

Claudia Sheinbaum, Mexico’s first female president has said little so far about how she plans to deal with Trump © Sashenka Gutierrez/EPA-EFE/Shutterstock

Trump’s campaign threats — blanket tariffs, inducements to US companies to bring production back home, the mass deportation of around 11mn illegal migrants and the designation of drug cartels as terrorist groups — would hit Mexico disproportionately hard.

Around half the migrants living without papers in the US are Mexican, Mexico is home to two of the world’s biggest and most feared drug cartels, and the country depends on the US market for 83 per cent of its exports. 

Trump will be one of the biggest challenges for Sheinbaum, a leftwing party loyalist and scientist whose academic background and stiff public manner could hardly be more different from the former New York property tycoon’s swashbuckling past.

Mexico’s first female president has said little so far about how she plans to deal with Trump, other than that there was “not a single reason to worry” about the countries’ “good relationship”.

Donald Trump and Mexican President Andrés Manuel López Obrador hold a press conference at the White House in 2020 during the Republican politician’s first term
Donald Trump and Mexican President Andrés Manuel López Obrador hold a press conference at the White House in 2020 during the Republican politician’s first term © Jim Watson/AFP/Getty Images

Her predecessor and mentor López Obrador built an unexpectedly strong personal rapport with Trump. Despite the two men’s ideological differences, they shared a preference for an authoritarian populist, nationalist style of government and transactional diplomacy. 

López Obrador deployed the military-led National Guard to block migrant routes and agreed to take back third-country migrants as they waited for their US asylum claims to be heard, while Trump backed off on threats to close the border, raise tariffs and make Mexico pay for a border wall.

Under Joe Biden’s presidency, the relationship continued along similar lines, with the US avoiding public criticism of Mexico’s rampant drug violence and López Obrador’s attacks on democratic institutions, in return for co-operation on holding back the flows of migrants.

Arturo Sarukhán, a former Mexican ambassador to the US and Washington-based consultant, said that while Sheinbaum would probably be more ideological than López Obrador, “what’s even more important is how a profoundly misogynistic man like Donald Trump will interact with the first woman president of Mexico”.

Private sector and currency investors remain hopeful for a repeat of the Trump-López Obrador love-in, with this week’s fall in the peso not as steep as when Trump was first elected. One senior banking executive said most of his big Mexican clients wanted Trump to win, hoping the Republican’s trade war with China would push more US companies to invest south of the border.

“We’re interdependent whether we like it or not,” said Antonio Ortiz-Mena, founder of AOM Advisors and a former diplomat. “Mexico has more savvy and more market leverage and joint production leverage than [people think].”

But patience with Mexico has run thin in the US capital in recent years, with co-operation on fighting drug cartels at a recent low, US companies complaining of a deteriorating business climate, and Mexico ignoring US concerns about a wide-ranging overhaul of its judiciary.

Observers in Washington point out that the country lacks powerful friends on Capitol Hill who would help it fend off hostile legislative moves. Sheinbaum has yet to name an ambassador to the US.

“I’m not sure the situation in 2024 is the same as in 2018,” said Martha Bárcena, Mexico’s ambassador to the US during the first Trump administration. “I see many more changes in US public opinion that is seeing Mexico less and less as a friend and more as a national security threat.”

People seeking asylum in the US stand in line as they are processed by Border Patrol agents after crossing into Arizona
People seeking asylum in the US stand in line as they are processed by Border Patrol agents after crossing into Arizona © Mario Tama/Getty Images

The Mexican leader’s hard-left credentials are also unlikely to endear her to Trump. Sheinbaum did not deny claims from Colombian President Gustavo Petro last month that she was a former member of his now-defunct M-19 guerrilla movement during the 1980s and she recently sent an aid shipment of oil to Cuba’s communist government.

Trump’s “policy towards Latin America is going to be controlled by the Cuban-Americans in Florida”, said Bárcena. “They will not be happy with Mexico giving oil to Cuba, helping [Venezuela President Nicolás] Maduro . . . that will be another very big point of friction.”

Hanging over the bilateral relationship is an impending review of the US-Mexico-Canada free trade agreement negotiated by Trump during his first term.

“Trump has already linked trade and migration during his campaign, threatening to use economic leverage to restrict migrant flows through Mexico,” said Eric Farnsworth, vice-president of the Council of the Americas business lobby in Washington.

“Sheinbaum will have to decide whether to resist this approach or . . . to accommodate US priorities. With a mandated review of USMCA in 2026, the stakes are monumentally high.” 

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