Executive Briefings

Mexican Exporters Fear Tough Times With Trump

From avocado orchards to border factories, Mexican exporters who have prospered under two decades of NAFTA face the prospect of an abrupt end to the boom if U.S. President-elect Donald Trump carries out his threats to ditch the free trade pact.

Trump says the North American Free Trade Agreement favors Mexico at the expense of U.S. workers and has vowed to either rewrite or withdraw from the deal, as well as build a giant border wall and possibly slap steep tariffs on imports.

Since the treaty took effect in 1994, Mexican exports to the United States have jumped six-fold to some $320bn a year, transforming a once-closed economy into a hub for investment and a workshop for some of the world's biggest companies.

So business leaders there were stunned as Trump romped to victory this month, upsetting the widespread expectation in Mexico that his candidacy would fade.

“(We) couldn’t believe what was unfolding before our eyes,” said Marcello Hinojosa, president of the Canacintra industrial chamber in Tijuana, the border city whose economy is based on a mix of U.S. tourism and assembly plants. "Our main partner where we export is the United States. So if we take that away we’re going to have a lot of unemployment, we’re going to have a really big trade deficit."

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Trump says the North American Free Trade Agreement favors Mexico at the expense of U.S. workers and has vowed to either rewrite or withdraw from the deal, as well as build a giant border wall and possibly slap steep tariffs on imports.

Since the treaty took effect in 1994, Mexican exports to the United States have jumped six-fold to some $320bn a year, transforming a once-closed economy into a hub for investment and a workshop for some of the world's biggest companies.

So business leaders there were stunned as Trump romped to victory this month, upsetting the widespread expectation in Mexico that his candidacy would fade.

“(We) couldn’t believe what was unfolding before our eyes,” said Marcello Hinojosa, president of the Canacintra industrial chamber in Tijuana, the border city whose economy is based on a mix of U.S. tourism and assembly plants. "Our main partner where we export is the United States. So if we take that away we’re going to have a lot of unemployment, we’re going to have a really big trade deficit."

Read Full Article