Temperature

A scorcher’s a coming…

We are only a few weeks into what is shaping up to be a long hot summer, with increasing turmoil around the world: U.S.-North Korea Summit, the G7 Summitprotests in NicaraguaBrazil’s upcoming elections, and the ongoing economic and political collapse in Venezuela.

Within regional relations, it hasn’t been much calmer. The highest profile spat was Donald Trump’s twitter attacks on Canada’s Prime Minister Justin Trudeau post the G7 meetings, followed by negative comments from other U.S. administration figures including Trade Representative Peter Navarro (although he later apologized). Yet in general, it’s hard to remember a time in recent history when North America’s integrated future has looked so challenging.

On trade, the NAFTA negotiations are decelerating, and the recent regional disputes surely won’t help speed things along. As suspected, the self-imposed May 17 deadline for bringing NAFTA to a vote in the U.S. Congress by the end of 2018 came and went with no final deal. In the void of an agreement, the United States imposed steel and aluminum tariffs, which went into effect on June 4th and marked this administration’s first policies to directly affect trade with the United States’ neighbors. Both Mexico and Canada immediately responded with tariffs of their own, with Canada imposing tariffs on a range of items from whiskey to dishwashing detergent, and Mexico applying its tariffs on products such as steel, pork, cheese, and cranberries that were targeted toward states and electoral districts with strong support for Donald Trump.

On regional security and migration, there haven’t been any positive cooperation stories for a while. In fact, the challenges only seem to be ratcheting up in intensity. The latest news out of the Trump administration on migration policy is to separate children from their parents when apprehended between ports of entry at the U.S.-Mexico border and also to remove domestic violence as an accepted grounds for seeking asylum (affecting many Central American asylum seekers). These changes will shift the U.S. immigration landscape, and it’s hard to see how they will garner much goodwill across the region. At the same time, despite high-profile insecurity news in Mexico, such as the recent murders of political candidates and the continued high rates of overall violence, there has been little movement on any pathway forward for jointly addressing these complex issues.

Last night’s third and last presidential debate in Mérida, Yucatán covered topics such as economic development and sustainability, and—as expected—all declared victory. But all this will come to a head in Mexico’s ‪July 1st presidential election, where it looks increasingly likely that Andrés Manuel López Obrador will emerge as the winner. An El Financiero poll released last week put López Obrador at 50 percent of the vote, ahead of his next closest rival—Ricardo Anaya of the PAN—by 26 points. In fact, Anaya fell by two points from the previous poll and now sits at 24 percent with PRI candidate Jose Antonio Meade closely behind at 22 percent. Independent candidate Jaime (El Bronco) Rodriguez remains stable at 4 percent. López Obrador is likely to toe a pragmatic line with the United States but pull back from some of the most high-profile cross-border engagements, including halting Mexico’s oil tenders. Additionally, while the presidential election is receiving the most attention, around 3,400 other officials will be elected ‪on July 1, including eight new governors.

At this time next month, Mexico will have elected a new president and hopefully things will have cooled down a bit across the region; but we’re talking July, so not likely. I look forward to hearing your thoughts as these topics evolve and hope that you will connect with me on TwitterFacebook, and LinkedIn.

Sincerely,

Antonio Garza