(Bloomberg) -- Mexico’s top economy official said that his nation can be a key intermediary as the US seeks to decouple from China.
“The tension with China will be a central part of the United States’s strategic reflection,” Economy Minister Marcelo Ebrard said at an event in Mexico City. “But we know that the US is our main trade partner, and we can try to influence, propose, and to some degree moderate the conflict.”
Ebrard made his remarks as world leaders gather in Lima for the Asia-Pacific Economic Cooperation meetings this week. US President Joe Biden will meet his Chinese counterpart, Xi Jinping, in Peru on Saturday for the last of three in-person sit-downs between the leaders during the US president’s term in office, according to senior administration officials.
Ebrard said that Mexico was in better position than before to negotiate its review of the North American free trade agreement with Donald Trump than it was during the president-elect’s first term.
Ontario Premier Doug Ford this week accused Mexico of being a back door for Chinese goods into North America. Ford said Canada should negotiate a bilateral trade deal with the US unless Mexico matches US and Canadian tariffs on Chinese imports.
Ebrard said that replacing the three-way trade agreement with bilateral pacts would not be in the interests of any of the three countries. He also denied that Mexico is a back door for Chinese cars —a claim Trump has made. Ebrard said the only Chinese automaker plant he was aware of in North America was BYD Co.’s in California.
If the US were to impose tariffs of 20% on Mexico, some studies show that could could increase US inflation by 3 to 5 percentage points, Ebrard said. Trump during his campaign threatened to impose tariffs on Mexico, including for what he characterized as insufficient action to stop migration to the US-Mexico border.
“If we were seated with President Trump, I would say to him, ‘Look at how well the trade agreement that you established turn out, how well the negotiation turned out. This is the best business that the US has ever done in its history, and I have the facts,’” Ebrard said.
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