Donald Trump, the U.S. president, has decided to suspend tariff increases on Mexico for 90 days. This is expected to open a new chapter in trade relations between the two countries. On July 31 (local time), President Trump announced via Truth Social that he had finished a call with Mexican President Claudia Sheinbaum and would maintain the current 25% tariff rate, which was originally imposed on the grounds of fentanyl inflow. The 25% tariff on automotive items and 50% on steel, aluminum, and copper will also remain in place, but Mexican items that meet the criteria of the U.S.-Mexico-Canada Agreement (USMCA) will be exempt from tariffs.

President Trump described the call as "successful" in helping the two leaders "understand and get to know each other." He added that Mexico had immediately agreed to suspend numerous non-tariff trade barriers and that they would hold talks over the next 90 days with the goal of reaching a final agreement. Mexico's non-tariff barriers have been known to include delays in import permits for agricultural products, strengthened hygiene and safety regulations for specific items, and increased border inspections. These measures have been cited as a cause of trade imbalance, as they have made it practically difficult for American products to enter the Mexican market.

Despite being a key neighbor to the U.S., Mexico has been one of the "first targets" for tariffs, along with Canada and China, since President Trump took office. On July 12, President Trump had increased pressure by sending a letter to Mexico, stating he would raise the current 25% tariff to 30%. This was based on the Trump administration's judgment that Mexico was lukewarm in controlling the inflow of illegal immigrants and fentanyl.

At a press conference on July 31, Mexican President Sheinbaum said that Trump had treated Mexico with respect in all their conversations, and while they "may not agree, [the U.S.'s treatment of Mexico] is respectful." She evaluated that Mexico was securing the best possible agreement compared to other countries, and that their strategy of "maintaining calm and composure and firmly defending our principles has been effective." Since before her inauguration, President Sheinbaum has emphasized a pragmatic approach to relations with the U.S. and is expected to maintain a policy stance that simultaneously pursues economic stability and the defense of national sovereignty.

Meanwhile, in a post on Truth Social ahead of the August 1 trade negotiation deadline, President Trump praised the effectiveness of his tariff policy, stating, "Tariffs are making America great and wealthy again." He claimed that while tariffs had been used to America's disadvantage for decades, the trend has now completely changed and "America has successfully responded to the onslaught of tariffs." The White House announced that it would enforce reciprocal tariffs on non-agreement countries starting at 12:01 AM on August 1, and the signing of a related executive order is expected later that day. The tariff suspension for Mexico is being interpreted as an example that the Trump administration's trade policy is not simply rigid, but also has a pragmatic side that leaves room for negotiation.

[Copyright (c) Global Economic Times. All Rights Reserved.]