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America’s Abuse Of Mexico Is An Assault On Free Trade

The News International

Days into his presidency, Donald Trump’s decisions have opened confrontations on several fronts and confirmed our fears: not only is he a threat to international trade and global growth, but also to the international order, the environment, racial and religious minorities, Nato, the UN and a long et cetera.

Unfortunately, President Trump has shown a special interest in abusively hitting Mexico, knowing that there is a huge asymmetry between our countries. As long as he believes that “every nation” has been taking advantage of the US, Mr Trump’s attitude towards Mexico – threatening, insulting, with an intent to humiliate – points to a potential pattern. How should other countries react?

Mr Trump has argued that the North American Free Trade Agreement is unfair because there is a trade deficit for the US. The accusation is absurd and reveals a misunderstanding of basic macroeconomic concepts. This protectionist theme is reminiscent of the worst demagogic regimes in Latin America and their failures. Mr Trump ignores how successful Nafta has been for the US and the whole North America region.

Indeed, the Mexican and the US economies are complementary. This has led to highly integrated value chains: products worth $1.5bn cross the border each day. Mexico is the second-largest buyer of American goods at almost $250bn in 2015 – more than twice as much as China and roughly the same as the whole EU, including the UK. American exports to Mexico – which have grown 7 per cent a year on average – directly support an estimated 1.1m  American jobs, and 6m depend on bilateral trade. Forty per cent of the value of the final goods exported from Mexico to the US is added in the latter. This integration is precisely why North America is one of the most dynamic regions in the world.

Nafta has been an engine of growth on both sides of the border: sabotaging Mexico’s economy cannot contribute to regional development. Further, the more jobs Mr Trump destroys in Mexico, the more immigrants he will attract.

Building a wall between two countries that are neighbours, partners and supposed allies, is a hostile act itself. We have come to learn, after several decades, that such ideas are both expensive and useless. Over 1,000km of barriers have already been built and there are huge technical, environmental and legal obstacles to finishing the barricade. Besides, net immigration of Mexican workers into the US fell to zero in 2010 and is currently negative.

Obviously, nobody wants to pay for such a project. Hence Mr Trump came up with the ridiculous proposal that Mexico should do so. The entire Mexican people (and a large number of Americans) refuse to accept such a senseless idea. Where in the world and under which law is it acceptable that, if your neighbour builds anything on his land, you must pay?

Mexico will not let this abuse pass. We must defend ourselves legally, diplomatically, economically and politically. There are legal tools under international law, both in Nafta and the World Trade Organization, and under American laws, which Mexico could use to fight back. Part of the greatness of the US lies in the rule of law. Already its judges are demonstrating what that means – even for the nation’s foremost individual.

Also, in the US hundreds of automotive, retail, agricultural and other exporting companies are organising to opposeimport tariffs and restrictions on trade with Mexico as these measures would raise prices for American consumers and would wipe out US producers from competing globally.

The likely outcome of renegotiating Nafta would be very negative to Mexico. So there should be no such renegotiation. But if Mexico is forced to the table, it should open up the entire bilateral relationship – namely security, the fight against organised crime and drug-trafficking, transit migration and intelligence co-operation.

President Trump’s team needs to understand that the US should not take Mexico for granted. It cannot afford to lose its southern neighbour, a vital ally in many aspects for the US.

International co-operation is essential. Beyond the senseless wall and its funding, there is much more at stake. The foundations on which modern civilisation is built are themselves at risk: freedom, respect among nations, the rule of law, democracy, free trade and economic liberty, all of which are essential to boost growth. Mexico will resist, but needs support and solidarity in its defence of liberal values. They are being challenged by the most powerful politician on earth.   

The writer was president of Mexico from 2006 to 2012  

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3 Companies That Could Suffer From a Trump Trade War With Mexico

3 Companies That Could Suffer From a Trump Trade War With Mexico

When Donald Trump was elected president, stocks rose as investor optimism grew that a united Republican government could deliver pro-business reforms such as tax cuts and reductions in regulations.

However, in his first week in office, Trump pushed forward the idea of a 20 percent tariff on goods imported from Mexico. Protectionism is generally anathema to Wall Street and the big business community, but seems to be a core component to Trump’s economic policy. White House spokesman Sean Spicer said recently that the president had discussed the border tax with Congressional allies and would soon put forth a proposal.

However, lawmakers on both sides of the aisle attacked the move, and Spicer stepped back from the idea, saying it was just one of many ways the country could make Mexico pay for the border wall Trump wants to build.

At this point, it’s unclear if the tax will be implemented, but Trump seems intent on fulfilling many of his campaign promises, which seem to include a trade war with Mexico in the form of stricter border controls, import taxes, and pressure on American companies to not outsource jobs.

Even if the tax does not get enacted, the news has already had an effect as Mexicans have begun boycotting American companies and products.

Let’s take a look at a few of the companies that could be most affected. 

1. Chipotle Mexican Grill, Inc. 

The nation’s largest Mexican food chain may not have a direct relationship with Mexico, but it’s still affected by economic policies around Mexico in one definitive way. Our southern neighbor is our biggest exporter of fruits and vegetables, accounting for nearly half of the fresh produce we import. Among popular fruits and vegetables that are widely imported from Mexico are mangoes, tomatoes, and, of course, avocados. Mexico is the world’s biggest producer and exporter of avocados, and the U.S. imports two-thirds of the trendy fruit consumed here, almost all of which comes from Mexico.

Chipotle would be one of the businesses most affected by rising avocado prices, which are already high as demand has built for the fruit. The company does not break out components of its food costs, but it spends about a third of its revenue on food. While commodity prices for meat and dairy have mostly fallen recently, management has complained about rising avocado prices. In its preliminary earnings report, the company said avocado dented profits, and an import tax would likely do the same. Though it may only push up food costs by as much as 100 basis points, Chipotle needs all the help it can get at a time when it’s still struggling to recover from the 2015 E. coli outbreak.

2. Wal-Mart Stores, Inc. 

Outside the U.S., no country is more important to Wal-Mart than Mexico. About one-fifth of the company’s stores are located south of the border, and Wal-Mart’s imports rely on many products imported from Mexico. The company was the subject of bribery investigations in Mexico a few years ago, and seems to be a principal target of the boycott being pushed against some Mexican companies. With 2,379 stores, Wal-Mart is only the largest retail chain in Mexico, but animosity seemed to be building against it, as seen on  Twitter  under the hashtag #Adios WalMart. 

Groceries also make up the majority of Wal-Mart’s sales, and agricultural trade across the border is strong. Mexico would likely implement a border tax, testing Wal-Mart’s North American supply chain and causing higher prices.

3. Constellation Brands

Finally, the company that would most be affected by an import tariff is Constellation Brands, an alcohol distributor that owns the U.S. rights to distribute Corona and Modelo beers, which are made in Mexico. Constellation Brands fell about 4% after Spicer announced the import tax, and the issue attracted attention from even Senator Lindsey Graham.

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In Mexico, Trump triggers a surge in patriotism, anti-American sentiment

Recently, Alma Siller Contreras traveled to the U.S. Consulate in the northern Mexican city of Hermosillo with a mission: to hand over her tourist visa, along with a handwritten message about U.S. President Trump.

“This is my way of protesting against him and supporting my beloved country and its people,” Contreras wrote.

She had long used her tourist visa to shop and visit family north of the border, but began contemplating giving it up when she and her husband watched Trump announce his candidacy with what she considered an odious attack on the character of the Mexican people. 

“I said, ‘He has a hatred in his soul; this isn’t normal. He’s not prepared to be a leader of a country. This is dangerous,’” Contreras recalled. “I said, ‘If he wins, I’m going to return my visa.’ My husband said, ‘I don’t think he’ll win, he’s crazy.’ I never thought it would happen.”

On Jan. 30, she made good on her pledge.

Through actions big and small, a wave of nationalism is rising in Mexico. It’s not joyous or self-congratulatory. These expressions of patriotism appear defensive, uneasy and even mournful in tone, as Mexicans wait to see whether Trump’s threats will turn to action. In the meantime, many here are asking themselves what they can do to support their fellow citizens. The answers take many forms.

For Luis Alberto Trasviña, a history teacher in Baja California, action meant bringing his family to the Mexican capital on vacation instead of going to the U.S. — a way to support the national economy and avoid anti-Mexican sentiment.

For chef Eduardo Garcia, owner of several restaurants in Mexico City, it meant offering free classes on using Mexican-produced ingredients. The first class instructed 50 students in how to choose and use Mexican avocados.

For a group of families from a Protestant church with Mexican and expat members in Mexico City, it meant organizing to protest anti-immigrant policies.

“We want to do something, and people feel helpless,” said Doug Keillor, a member of the group and founder of a nonprofit that advocates for juveniles in Mexico’s criminal justice system.

Though Keillor’s wife was pushed and told to go back to the U.S. while she was shopping at a Wal-Mart in December, Keillor viewed the incident as an aberration. Most Mexicans, he said, are savvy about U.S. politics.

Keillor, who notes he and his wife are adopting a 2-year-old Mexican boy, added, “If we eventually move back to the U.S., we come from a very homogeneous part of Minnesota, a very red, politically, part of Minnesota — are we going to be very excited to bring our Mexican son to live there?” 

A movement to buy Mexican products is also being pushed in friendly conversation and by government officials. President Enrique Peña Nieto relaunched the label “Hecho en Mexico,” or Made in Mexico, last week on Twitter, saying the label should signify quality and trustworthiness.

On social media, profile pictures have switched to Mexican flags. Hashtags such as #AdiosAStarbucks encourage consumers to boycott U.S. brands.

But some Mexicans find it all a bit silly.

Luis Padilla, a 20-year-old university student in Mexico City, has no plans to change his spending habits, or his brand of coffee.  

“I like their coffee, and simply not buying a cup of their coffee is not going to hurt the president over there,” he said. Pragmatically, he would continue to buy the brands of clothes he preferred, whether from the U.S. or Japan or Mexico, and he expected that the trend to boycott U.S. products would pass among his peers as well.

“It’s not bad to experiment with the traditions of other countries. It’s always good to learn,” he said.

But it appears some Mexicans are steering away from U.S. products. The Alsea company, which owns the Starbucks brand in Mexico, has tried to communicate to consumers that its coffee is from Chiapas, that it employs more than 7,000 people in the country, and that it’s completely Mexican-owned.

At a Starbucks in Mexico City’s Condesa neighborhood, baristas seemed frazzled by the overnight shift in public opinion. 

“I don’t think it’s well thought-out,” barista Luis Maguey said of the trend. “It was shocking to see —  it made me sad. We work to support our families.”

Kevin Ganser, a 29-year-old entrepreneur, said the election of Trump had prompted him to go all-in on a new startup that aims to link expats with housing in Mexico City. When Americans look up Mexico City, he wants them to be greeted with a “warm and friendly face.” 

Some politicians have suggested that if Trump’s policies inflict damage on Mexico, the country could rebound if Mexicans keep their heads down and work harder. That rhetoric frustrates Alfredo Perez, a 48-year-old engineer, who says it pre-supposes that Mexicans aren’t doing the the best they can for themselves and their families. The work week in Mexico is already six days long.

“How are we going to work more?” he asked.

As for Contreras, whose letter went viral after her cousin posted it on Facebook (Contreras herself doesn’t have a profile), she has no regrets about what she considers a personal choice to stand up for her country. 

“Mexicans are good people. There are always exceptions anywhere, but in general, the humble people of Mexico have very good hearts. I am Mexican, and [Trump] can’t generalize all Mexicans are this way or that, that all people from a country are the way that he imagines in his distorted brain,” she said. “This is a place of faith, and of hope.”

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.What you need to know

The following is taken from

You need Mexico car insurance because it’s required and US /Canadian insurance coverage stops at the Mexican border. Every year Mexico implements stricter laws for uninsured motorists, meaning not having it can cost you money due to damage/loss to your vehicle, fines and more
When you drive your car to Mexico, travel with complete peace of mind, by being properly insured. Your U.S. or Canadian insurance policy, however comprehensive, won’t cover you in Mexico, but affordable insurance is available…

Mexican Auto insurance You Can Trust if you ever get into an accident in Mexico

Insuring Your Car in Mexico
Although your U.S./Canadian car insurance policy may be comprehensive, and might also extend some limited damage coverage in Mexico, you will still need to purchase policy that is legally valid in Mexico.
U.S. and Canadian auto insurance policies, however comprehensive, hold no legal jurisdiction in Mexico. This means that you must buy separate insurance cover for your car while you’re driving in Mexico if you want to travel with complete peace of mind.

If you are driving your car improperly insured in Mexico and you become involved in an accident it will, at best, cost you a lot of money and, at worst, leave you imprisoned in a Mexican jail house. Presenting a U.S. or Canadian auto insurance policy will be of no use because these documents have no legal or actual force in Mexico, and the companies backing them will not settle any claim arising when you or your car are situated south of the border.
Drivers who are involved in serious accidents in Mexico are usually arrested pending investigation. If you are not properly insured in Mexico and become involved in a serious accident—even if it’s not your fault—these procedures will likely place a great deal of stress and financial burden upon you.
This guide explains how insurance works in Mexico and how to go about buying the additional insurance protection you need to ensure that you, your passengers, and your vehicle are properly insured when driving on Mexican soil and that, in the event of a serious accident, you are properly covered by a legally-valid and adequate insurance policy.
Mexican Auto Insurance
Mexican Law stipulates that only insurance companies which are licensed in Mexico can provide the type of auto insurance coverage that is recognized and accepted by Mexico’s legal system.
A few U.S.-based insurance companies will extend physical damage coverage on cars and RVs while they are situated in Mexico, but they cannot and do not provide Mexican liability insurance. So, although these policies may cover your damage, they will not cover your liability to others in Mexico. This is why a special insurance policy is absolutely necessary to be properly insured in Mexico.
Mexican Insurance Companies
Mexican Law also stipulates that liability insurance must be purchased from a licensed Mexican company, so your auto insurance policy necessarily needs to be issued by one of Mexico’s insurance companies, or through a broker in the U.S./Canada working in conjuction with a Mexican insurance company.
Who’s Insuring You?
Buyers purchasing insurance for their car in Mexico are often times misled by believing that they can rely on the broker, rather than the Mexican Insurance Company, to properly handle any claim that may arise during their stay in Mexico.
The insurance company underwriting your policy is much more important than the Broker that sells you the policy.
As all insurance policies are sold through brokers, it’s important to know which insurance company (or companies) are underwriting the policies being sold to you by the broker. Click here to read more  Click here to get your free quotes


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