Tariff War
Clash inside the cabinet: AMLO has a tariff decree ready to retaliate against Trump
Some members of the cabinet want to yield: "We are not China, we can't endure a commercial war," said embattled Foreign Minister Ebrard.

"The current situation cannot withstand. The migration flux is growing too much". These words were not said by Donald Trump or Mike Pompeo, but Marcelo Ebrard, the Foreign Secretary of Mexico, during the press conference he gave in Washington, after a meeting in the White House where he tried to stop the US Government's raise on tariffs.

Such a statement proves what, in recent days, was being said inside AMLO's cabinet: the Mexican Government must yield, and then toughen immigration controls. The real cost for Mexico is going to be felt as an escalation of an economic problem with Trump, during a time in which Mexico's performance is not at its best.

"We are not China, we could not withstand a commercial war with the US" has been the main position of several members of the Cabinet, who are trying at all costs to avoid a retaliation from the President. Responding with mirrored measures could slow down Mexican growth even further. Some economists have even speculated with a possible recession.

Ebrard's problem is clear: even though he'll stay another working day in the United States, it seems unlikely that by Monday the US will back off in the 5% tariffs. This point was raised to him at the press conference: if there is no agreement, and the tariffs are implemented, will there still be an open dialogue?

"We have to exhaust the chance we have now, trying to hold an economic impact for the next week. I do not like to speculate, but if this happens, we still must continue with the dialogue and work on the matter. We would like to avoid the impact of tariffs for both economies", the Minister replied.

LPO was able to find out that AMLO's economic team has already handed in a decree, waiting for his signature. The proposal includes a package of tariffs on products from the United States. The rates would be variable depending on the product, but the goal seems to be to target the states that have more trade interaction with Mexico, in order to hit Trump's electoral base. This is another variant of the scenario inside the Government.

"López Obrador had summoned the entire group to the National Palace this Thursday at noon, but after the first meeting at the White House, Ebrard decided to stay one more day to see if the discussion progresses. The idea was to determine whether to respond with that decree, or to look for another alternative," a source inside the administration told LPO.

Another interesting fact: Graciela Márquez Colín could return to Mexico in the next few hours since, paradoxically, the agenda so far does not include commercial matters, but it is more focused on the immigration issue.

Last night, after the talks, the Mexican delegation dined with a group of executives from the American auto industry that would lobby to convince Trump that applying the tariffs on Mexican products would strike a major blow on US industries. 

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