US President Donald Trump has threatened to impose a tariff on all goods coming from Mexico in an effort to curb the flow of illegal immigrants crossing the southern border.
Trump announced his decision on Thursday on Twitter and in a subsequent statement, saying the tariffs will start at 5 percent and increase until the tide of people ceases.
Higher tariffs will start at 5 percent on June 10 and increase monthly until reaching 25 percent on October 1, unless Mexico takes immediate action, he said in a statement posted on the White House website.
The US president’s decision was a direct challenge to Mexican President Andres Manuel Lopez Obrador and appeared to take the Mexican government by surprise.
“If the illegal migration crisis is alleviated through effective actions taken by Mexico, to be determined in our sole discretion and judgment, the tariffs will be removed,” Trump said.
Trump also told reporters at the White House on Thursday that he will make a "dramatic" statement about the country's southern border with Mexico this week.
Trump’s move significantly ramped up his battle to reduce a tide of immigrants that has swelled despite his anti-immigration policies.
It also raised the risk of deteriorating economic relations between two neighbors which are heavily dependent on the cross-border flow of goods.
US officials said 80,000 people are being held in custody with an average of 4,500 arriving daily, overwhelming the ability of border patrol officials to handle them.
A source close to Trump told Reuters there had been an internal debate inside the White House over whether to pursue the new policy, with immigration hawks fighting for it and others urging a more diplomatic approach.
The source said Trump eventually sided with the hawks, who spoke on condition of anonymity.
“We’re in a good moment building a good relationship (with the United States) and this comes like a cold shower,” said Mexico’s deputy foreign minister for North America, Jesus Seade.
Seade said it would be disastrous if Trump goes through with his threat to impose the tariffs. Calling Trump’s move “extreme,” Seade said a normal response would be for Mexico to “mirror” the US tariffs but that would lead to a trade war.
Trump has made immigration a cornerstone of his presidency and had promised during his election campaign that he would build a wall along the US- Mexico border.
Trump's new move comes as lawmakers in the US, Canada and Mexico are in the process of ratifying the US-Mexico-Canada Agreement (USMCA), a trade deal that will replace the North American Free Trade Agreement (NAFTA).
It also opened up a new front on trade as the Trump administration struggles to conclude a trade deal with China.
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