Global Trade Uncertainty and Mexico’s Economic Outlook
The recent improvement in growth expectations for Mexico’s economy, along with many other countries, does not reflect an improvement in conditions but rather a postponement of risks. The global impact of US President Donald Trump’s tariff policies has found room to adjust amidst business resilience in the face of restrictions and cost increases. However, this margin is rapidly diminishing.
Weekly, new threats and tariffs imposed by Trump emerge, reflecting his impulsive reaction to his mood swings. One day he may warn of massive tariffs on China, disrupting markets as he did last week, only to reverse his stance hours later, claiming it could all be a friendly conversation with Xi Jinping.
Mexico’s Economic Challenges and International Relations
Mexico faces not only direct impacts from Trump’s tariffs but also scrutiny of the ongoing T-MEC (United States-Mexico-Canada Agreement) review, given Trump’s influence over its implementation. Confusing signals from Washington DC are further complicated by internal mixed messages.
- Economic Tranquility vs. Internal Division: Mexico’s Secretary of Economy attempts to reassure markets about the T-MEC review, while the Secretary of Security maintains confidence in the US. Meanwhile, Mexico City Mayor Claudia Sheinbaum sends conflicting political messages, supporting Latin American dictatorships—a stance unlikely to be well-received by the Trump administration.
- Trump’s Attention to Mexican Actions: The Trump administration, particularly the State Department under Marco Rubio, has turned a blind eye to Mexico’s actions regarding Latin American dictators. This includes disregard for Venezuelan opposition leader María Corina Machado and shipping subsidized hydrocarbons to the Cuban regime. Such behavior may not go unnoticed by the White House.
- Diplomatic Missteps: Claudia Sheinbaum’s absence from the upcoming X Summit of the Americas in December, as a form of protest against the exclusion of Cuba, Venezuela, and Nicaragua, will likely draw US public attention. These diplomatic missteps could prompt Trump to further complicate Mexico’s 2026.
Consequences and Uncertainties for Mexico’s Future
The challenges faced in this difficult year are likely to persist into the next, given the unchanged global trade landscape and Mexico’s precarious international relations. Inflation and accumulated deceleration, along with lingering uncertainty over potential impulsive decisions, pose significant obstacles for Mexico’s economic growth.
