Mexico will break off trade talks with the United States if it insists on duties or quotas on Mexican exports.
U.S. President Donald Trump and his administration have made it clear they favor tariffs or border taxes on Mexican products.
But the moment they do so, said Economy Secretary Ildefonso Guajardo, Mexico will leave the table.
“The moment they say, ‘We’re going to put a 20% tariff on cars,’ I get up from the table,” Guajardo told Bloomberg in an interview. “Bye-bye.”
The secretary stressed that Mexico would not be looking to scrap the North American Free Trade Agreement, or NAFTA, but if negotiations over the accord fail “it wouldn’t be an absolute crisis.”
Trade between the two nations would fall under World Trade Organization regulations. That would “take away some of our margin of competitiveness,” Guajardo said, but would be manageable.
However, he was optimistic that the three NAFTA partners, Mexico, the U.S. and Canada, could come to terms on a modified agreement. “I think there is a way to find a very good agreement that will be a win-win for the three countries.”
Guajardo said the agreement could be improved by adding themes such as digital commerce, telecommunications and some aspects of the energy industry that were not included in the 20-year-old pact.
Mexico has said talks are to begin in June. The Economy Secretary hopes they will conclude in early 2018, ahead of Mexico’s presidential election and the mid-term elections in the U.S. that year.
Source: Bloomberg (en)