Front Burner - Trade war: The view from Mexico

Episode Date: March 11, 2025

As Canadians grapple with the ongoing threat of American tariffs, south of the U.S., Mexicans are dealing with the same thing. Today we look at the similarities and differences in the situations both countries are facing, the different ways our leaders are dealing with Trump, and the surprising impacts the tariff threat may be having in Mexico’s war on drugs.Elías Camhaji, a reporter with the newspaper El País based in Mexico City, joins us.For transcripts of Front Burner, please visit: https://www.cbc.ca/radio/frontburner/transcripts

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This is a CBC Podcast. Hi, I'm Jamie Prossant. On this occasion, and due to the strength of the people of Mexico, we gather here to congratulate ourselves. Because in the relationship with the United States and its government, dialogue and respect prevailed. On Sunday, Mexican President Claudia Shademan held a rally in Mexico City's central square, the Zocalo. She had called it last week to rally citizens

against the 25% tariffs imposed by U.S. President Donald Trump. But since Trump paused the tariffs on Thursday, just as he did for Canada, the rally turned into this kind of celebration. The square was packed with thousands of people. Just like Canada, though, Mexico of course is not out of the woods. Trump has set a new deadline of April 2nd for both countries, and his administration

says that it is imposing steel and aluminum tariffs on both countries this Wednesday. So as we sit with those details hanging over our heads, we wanted to get a view from Mexico. What's the same about what we're dealing with and what's different? How have both countries leaders differed in their approach to Trump? Today I'm speaking with Elias Camaji. He's a reporter for the newspaper Al Pais, based in Mexico City. Elias, thank you so much for coming on to the show. Hi, Jamie. Thank you for having me.

It's such a pleasure to have you. So what's the mood in Mexico right now around all of this? Do people feel major relief about this pause in the tariffs, or do they feel like we're just going back to the same place in a few weeks? Well, you know, just as in Canada, tariffs have been all over the news for the last couple of weeks. It's a tough story here without any doubt. So when Trump announced the pause last week, the overall feeling was relief for sure. So it was a little bit funny for us. We didn't know what this event was for last Sunday. It

was supposed to be the announcement of the retaliation measures by the Mexican government, but since then it's become a celebration. So we are celebrating that we get to live another month without these tariffs and the threats of the Trump administration. So we're gonna be talking about a lot of the similarities and differences between the Mexico and Canada situations today. One major similarity is that a big pretext

from the Trump administration for these tariffs has been to stop the flow of fentanyl into the U.S. But the big difference, of course, is that only 0.2% of the fentanyl seized at the U.S. border is coming from Canada, whereas the vast, vast majority of it does come from Mexico. And actually, President Shane Baum, it seems, has taken some steps that have lowered fentanyl traffic over the border pretty significantly. What has she and her government done on that front? Well, we've seen a major shift under this government in terms of public security. Shane

Baum's administration has been way more aggressive towards crime and the war on drugs compared to the previous president. During the last five months, for example, at least 13,000 people have been arrested and we have the biggest fentanyl seizure in the history of our country last December. So after Trump won the presidential election, the Mexican government first tried to make him come around. They said like, look, the migration flows are going down. The drug flows have gone down as well, we should be partners, right? But Trump didn't care about data or the numbers. That's not his language, so to say.

So the Mexican authorities quickly realized that and they realized that what Trump actually wanted was trophies to show off to his supporters. Back in February, after the first pause in the tariff war, Mexico agreed to deploy 10,000 soldiers at the border, for instance. And that was a very powerful image. The Mexican National Guard troops will be stationed at several hot spots along the border, for instance. And that was a very powerful image. The Mexican National Guard troops will be stationed at several hot spots along the border on the Mexican side. Their goal, according to the deal, is to, quote, reinforce the border. And Trump took credit for that.

And he implied that he finally got Mexico to do something against organized crime and to solve the Mekan crisis. They've agreed to put in 10,000 soldiers permanently, like forever, 10,000 soldiers at their side of the border and stop fentanyl and illegal aliens from coming into our country. They have a big incentive to do. Other than that, we've agreed to talk. A couple of weeks ago, Mexico carried on a massive operation, handing over 29 notorious drug lords to the US.

And that was another trophy for Trump. This morning, four decades after he was convicted in Mexico for orchestrating the murder of an American drug agent, one of the most notorious Mexican narco traffickers is locked in a Brooklyn jail. Rafael Caro Quintero was among 29 cartel leaders. The question now, Jamie, is what's next? And what's going to happen in April for us? About Atari 4, no? And that's a big unknown.

We don't know what's going to happen in just a couple of weeks. Yeah, just on the fentanyl issue, obviously experts will debate whether or not any of these measures will actually stop Americans from dying of fentanyl overdoses. Like, if the demand is still there, they say the drugs will get made somewhere. But regardless, as you were talking about, there is evidence that at least some major hubs for fentanyl production in Mexico, that production has slowed down over the past couple of months, at least for now. And Chainbomb recently quoted figures from US Customs and Border Patrol that showed that seizures of fentanyl had dropped 75% in the last six months. So is there a case to be made that Trump's methods had been quite effective here?

And how are people in Mexico feeling about that? Well, absolutely. And this is obviously very problematic because we have seen this movie over and over again during the war on drugs. We have seen the manhunts, the SWAT-like operations, the arrest of El Chapo and other notorious drug lords, and you can fight the cartels all you want, but drug trafficking is a market, right?

And the U.S. have been very reluctant to acknowledge that and to acknowledge that they have an enormous responsibility to recognize that the demand for drugs is enormous on the other side of the border. Having said this, some specialists and established thinkers have argued that the situation in Mexico was unsustainable, unbearable, and that something needed to change. In Sinaloa, for example, the home ground of the Sinaloa Cartel, there's been an ongoing war that's killed hundreds of people since last September. Just so you can imagine, people were afraid of going to work, taking their kids to school,

carrying on with their own lives, having a normal life, so to say. Something had to be done. And Trump's permanent pressure on the Mexican government did play a role during the last months to make this happen. But the question here is, how high is the price to take these actions? And why is a foreign government telling us what to do, who to attack, how to respond to the drug cartels. So it's a very touchy and sensitive issue here because violence is real, but we are a sovereign

country and we should be able to face this crisis in our own terms um acting actually in a partnership with the US not assuming all the blame for the drug crisis right My understanding, and correct me if I'm wrong, is that Shane Baum went further than anyone expected her to, to try to appease the Trump administration's demands. And yet, Trump still slapped tariffs on Mexico last week, the same as Canada. It's going to be very costly for people to take advantage of this country. They can't come in and steal our money and steal our jobs and take our factories and take our businesses and expect not to be punished. And they're being punished by tariffs.

Take me back to the reaction last week. What did that say to people that Trump still went ahead with these tariffs? Well, it was very disappointing and confusing, to be honest, because the appeasement of Trump was the top priority of this government. Actually, half of the cabinet traveled to Washington a couple of weeks ago in order to secure this deal, and for a few days, nothing happened. So was it all for nothing? And that's what we were all thinking, right? There was this feeling that we couldn't know what the person

sitting on the other side of the table, your so-called partner, quote-unquote, wanted, right? And of course there was a lot of anxiety, especially among the elites, because this unpredictability really affects your capacity to plan ahead, to decide on your immediate future, to hire people, etc. But I think we have also been able to develop a sort of emotional intelligence when it comes to Trump. People are not rushing to panic anymore, not like the first times or not like before he took office. And we've come to accept that this is the new name of the game. Trump is changing, but we are changing as well.

We are developing this, you know, this tolerance and this resilience to face these permanent threats. to face these permanent threats. I think a lot of people here in Canada can probably relate quite deeply to what you just said there. Another big point of similarity here is that we here in Canada have seen this rally around the flag effect, big shows of nationalism, people refusing to buy American products or even go to the US on vacation, for example.

Approval ratings for both Trudeau's Liberal Party and even the soon to be former Prime Minister Trudeau himself have climbed considerably over the past couple of months. And just, I know that you mentioned you had that big rally that turned into a bit of a celebration, but are you seeing something similar in Mexico? Absolutely. You know, Jamie, I think it's awesome that we're doing this actually, because we finally

get to see how similar we are, even though we're so far away. But I think one key factor to understand is Shane Bounds on popularity. When she, when she took office last October, her approval rating was around 70% in most polls with, which is actually very, very high, but now she's got an approval rate about 80% and she's, she's by far the most popular president we've had in decades. So her response to Trump has played a huge role behind this search, for sure. And there's also historical factors at play

cultural factors of playing nationalism at play in Mexico. You know, we have the saying we say, we are too far from God, and too close to the US. And I think that's something Canadians can relate to. So when President Trump issued all these threats, there was also this rally around the flag effect and the general perception was that Mexico was under threat. So most people got behind the government. We've seen the same videos

on social media, right, of people crushing American products. We're witnessing something interesting in North American politics. Shall we call it the Trump effect? We're seeing what happened with Trudeau, even Carney, knowing in his first hours in office, here is happening the same. People like to see their leaders standing up to Trump. And even when we're in school, they tell us about how we lost more than half of our territory to the US.

There's this love and hate relationship, right? So when we hear about Trump's jokes on Canada saying they are going to become the 51st state, we can relate and we can sympathize with you guys. So I think it's very interesting. And I think it's something we have not foreseen before. We were seeing everything in defensive terms. How are we going to cope with this new White House? But we're also seeing governments

all over the world that are going stronger by standing up to Trump. I'm Nicola Coughlin and this is history's youngest heroes, Terry Fox's Marathon of Hope. I think of home a lot. I think of running into Vancouver and running into where I'm going to finish on the ocean and all you got to do is take another step and keep on going. He planned to run 5,300 miles across the second largest country in the world. Makes you believe in the human race again. Join me, Nicola Coughlin, for history's youngest heroes,

wherever you get your podcasts. Could you describe Shane Baum's approach to dealing with Trump? Sure. Yeah, maybe contrast that to how Trudeau approach to dealing with Trump? Sure. Yeah, maybe contrast that to how Trudeau has been dealing with him. Sure. Yeah, if you see contrast there. Yeah, for sure.

I think something very important, Jamie, is that Trump and Trudeau didn't get along. We knew that since 2016. So there was this handicap before Trump took office. I think Shane Bummel has been way more cautious, way more strategic than Trudeau. It's not in my habit to agree with the Wall Street Journal. But Donald, they point out that even though you're a very smart guy, this is a very dumb thing to do. And I spoke to the president of Mexico, a wonderful woman.

It was a very respectful call. We've always treated President Trump with respect, and in the calls, he's always treated us with respect. Shane Baum has been very public about this, and she said her motto is... has been very public about this and she said her motto is calmness and a cool head she says when it comes to Trump. So I'm going to be patient, I'm not going to rush to take any decisions. I know he has this particular way of communicating, of expressing his opinion about our country. I don't care. We're going to be way more cautious because there's a

lot at stake. So in the case of Shane Baum, the big question was if sexism was going to play a role, if it was going to be important that she was a woman, but that she's a woman. And I think that's why it's so important for her to feel respected and by extension to feel that the US is respecting our country. And that's the red line that she's drawn in the last couple of weeks. She said, I'm going to be patient, but the red line is the respect for our country and our sovereignty, right? So when Trump announced this pause last week, he said, I'm postponing these

tariffs not only because the Mexican authorities have put these results on the table, but also because out of respect of her. So it was a major win. And something that's very interesting to note is that Shane Baum comes from a progressive party, right? The left is governing in Mexico. The predecessor was also a leftist. So surprisingly, Shane Baum and Lopez Obrador have been able to get along well with Trump, leaving politics aside and being very pragmatic. And I think Trump being a bully,

he respects a counterpart that is strong enough. It was really interesting to see how Trump referred to her, and then to see how he talks about our Prime Minister, he calls him governor. I spoke to Governor Trudeau on numerous occasions, and we'll see what happens. And last week he basically accused him of trying to use this crisis to stay in power, which is not true. Trudeau is expected to step down within the next couple of days.

But I think it also taps into much of what you were just talking about. I think Trump has seen Trudeau as this weak leader on his way out and also Trudeau has become kind of this avatar of like liberalism and wokeness, if you will, it's kind of like an easy target. Anyways, it's been really interesting to see how the rhetoric on both sides has been starkly different

even though the outcome actually hasn't been, right? The tariffs went on both our countries, got pulled off both our countries, went on both our countries, got pulled off both these countries. Materially, what has she been doing? So like here we have 25% counter tariffs on $30 billion worth of American imports. The province of Ontario is imports. The province of Ontario is imposing a 25% surcharge on all electricity. We're willing to like ramp that up in the next couple of weeks if things don't go well. Like what's going on over there? Well, we've, as I told you, we've been way more cautious and we, our approach was let's wait and see, right? Because the biggest losers at this point of the tariffs, if the tariffs were a reality right now,

would be the American consumers, because they would assume those taxes. Having said that, I think Sheinbaum is aware that the US-Mexico relations are very asymmetrical. Around 80% of our exports go to the US, so there are multiple sectors that would be affected. So I think she wanted to gain some time, to step back and see how this was going to be played. You mentioned 80% of your exports go to the U.S. I think here it's about 77% so that's quite comparable. 77%. What industries, what sectors would be the hardest hit here if the tariffs go through?

Well definitely the automobile industry for sure and the manufacturers because we have multiple components of this product coming back and forth over the border. So, terms don't make sense in those industries because, for example, if you're assembling a car. So you have one component that is done in Canada and then goes to the US and then goes again to Mexico and then comes back to the US and then, you know what I mean, when I'm going. So, mainly those two industries, also farming, we're also very dependent on, in terms of energy, gas production,

electricity production. Our economies are so intertwined and we're feeling that we're being pushed to diversify our relations with other countries because our main partners have been willing to part ways with us. Well, tell me more about that because I know Shane Baum has been talking about forging stronger alliances with Canada to try to fight this. Although I know at the same time, Mexico hasn't always been happy with how some Canadian leaders have been reacting to this, right? Like particularly Ontario Premier Doug Ford. Doug Ford said it was insulting.

I want to emphasize that compare us to Mexico is the most insulting thing I've ever heard from our friends and closest allies, the United States of America. We didn't like that, obviously. But you know, Jamie, if something interesting happened during the negotiations of the trade agreement a couple of years ago, Mexico and Canada actually teamed up to negotiate some parts of the agreement. And I think what Trump was trying before he took office, when he said like, well, why don't we have like two separate trade agreements? He was trying to break that.

No, he doesn't want to be the sandwich, so to say. No, he wants to end that partnership. So when we didn't know what was going to happen last week with the tariffs, Shane Baum hinted that she was going to call Trudeau to see if a joint response was possible. It's a factor to consider, right? Because it's a three-way agreement. So if two parts of the agreement are coming together to say you cannot do this and this is illegal under the agreement, their strength is bigger. It's a very interesting way to approach that.

But in reality, we don't have that much in common with Canada. And it's very difficult to diversify your international relations when you're so heavily dependent on one country. How do you go back from 70% you were saying or 80% of your exports going to one country? So that's not a solution in the short run. But it's also, my interpretation is that it's also a statement of will, right? To say, aren't we supposed to be partners? And if we are partners, we can come together and face you for that matter.

So I think it's an interesting game what we're seeing. Okay, Elias, it was really such a pleasure to speak with you today. I'm so glad that we had this chance to catch up. Thank you for your time. All right, that is all for today. I'm Jamie Poisson. Thanks so much for listening. Talk to you tomorrow.