In UK, Trump calls Mexico tariffs 'likely'

US President Trump's threat to impose tariffs on imports from Mexico starting next week unless it curbs illegal immigration into the US could raise the cost of burritos in the US by about 5 cents - and cars as much as $10,000.

Compared with potentially higher prices for cars, auto parts and flat-panel TVs manufactured in Mexico, a nickel increase for anyone hungry for a spicy, calorie-choked burrito made with an imported avocado would be irrelevant.

Trump wants Mexico to admit and house migrants traveling from Guatemala, Honduras and El Salvador via Mexico on their way to the United States, or to prevent them from entering the US illegally at borders with the states of Texas, New Mexico, Arizona and California.

Speaking on Tuesday at a news conference with British Prime Minister Theresa May in London, Trump said "it's more likely that tariffs go on" than not.

A Mexican delegation led by Foreign Minister Marcelo Ebrard is scheduled to meet with US officials on Wednesday in Washington, in an attempt to work out an agreement prior to the June 10 deadline set by Trump.

If a deal cannot be reached, Trump has vowed to impose a 5 percent tariff on about $360 billion in Mexican imports. The tariffs would rise 5 points each month and reach 25 percent in October, making tariffs on Mexico larger than those imposed on China in an ongoing trade dispute.

Ebrard said the proposed tariffs would damage Mexico's economy and undercut his nation's current efforts to curb illegal immigration to the US.

Ebrard tweeted: "We will be firm and defend the dignity of Mexico." There has been no official statement, but Mexico is expected to retaliate if Trump imposes tariffs.

Trump may face a revolt by Congressional Republicans, who say the tariffs would damage the economies of both nations and needlessly throw people out of work.

Some Republicans see Trump's proposed tariffs on Mexican goods as a mistake and appear to be lining up in opposition.

"This is a misuse of presidential tariff authority and counter to Congressional intent," said Senator Chuck Grassley, a Republican from Iowa and chairman of the Senate Finance Committee.

House Speaker Nancy Pelosi, a Democrat from California, said: "The president's threat is not rooted in wise trade policy but has more to do with bad immigration policy on his part."

US business leaders are puzzled by Trump's action because it follows the recently announced US-Mexico-Canada Agreement and would complicate its ratification in the Senate. Business leaders said tariffs would boost consumer prices and disrupt supply chains.

The Business Roundtable, an organization of CEOs from major US companies, said US immigration law must be updated to increase the number of highly skilled immigrants while increasing the number of temporary workers as needed.

The National Retail Federation, a trade group in Washington, said tariffs would increase consumer prices.

The US auto industry would be hardest hit. In an analysis of the US industry's exposure to the tariff, Deutsche Bank estimated that General Motors Co would take a $6.3 billion hit before interest and taxes; Fiat Chrysler Automobiles' hit would be $4.8 billion and Ford Motor Co's would be $3.3 billion.

scottreeves@chinadailyusa.com

(China Daily 06/06/2019 page11)