NAFTA and Mexico-US Relations

Can AMLO Election Affect NAFTA and Mexico-US Relations?

*Article originally published in Spanish. To read the original version click here

State policy is not necessarily a policy of the government, and that is, in essence, what many nations overlook. In theory, that’s what diplomacy is for. To negotiate international agreements that means long-term progress. However, it’s not uncommon for the opposite to happen. Governments of the left, right, center, among other extremes, often interfere in the treaties reached by their counterparts, and what should be a duty in favor of the state becomes a governmental policy.

Before finishing his term, in fact, Enrique Peña Nieto, managed to sign the T-Mec, or USMCA. He did so after a year of negotiations and closed the deal during the Argentina G20 summit. Him, US President Donald Trump and Canadian Prime Minister Justin Trudeau shook hands and said they would end the commercial uncertainty in the North American region. With this new proposal, these countries replace the North American Free Trade Agreement (NAFTA), which had been in force since 1994.

But, the thing is… In Mexico, as in many other countries of Latin America and the world, state policy is not immune to the ideologies of ruling parties. For that reason, it is important to discuss how the new Mexican president, Andrés Manuel López Obrador (AMLO), will face what is to come in commercial matters, both with the United States and with Canada. For this reason, we have spoken with Dr. Manuel Ángel Rodríguez Edeza, from the Universidad Autónoma de Occidente, in Sinaloa, Mexico. An economist, Master in Political Science and PhD in Social Sciences, Dr. Edeza will help us have a better understanding of this context.

López Obrador and the free market

“We are in favor of the free market,” said the new leader of Mexico during a routine press conference. He also launched a harsh criticism against what he calls the neoliberal economic model.

Lopez Obrador is a leader with nationalist tendencies. He has been president of the Democratic Revolution Party and the National Regeneration Movement, and was in coalition with, among others, the Workers Party. Some news portals have compared him with former Venezuelan President Hugo Chavez.

Lopez Obrador and Donald Trump, good diplomatic relations? How about commercial ones?

Weeks ago, expectations for a first diplomatic crisis between the two leaders were high. A caravan with some 7,000 migrants, mostly Central Americans, was heading for the United States border. It was no secret that the treatment that Donald Trump has given to immigrants is not the most humane, and therefore he has been severely criticized. But beyond that, the speech of the Republican leader against Mexico has broken every paradigm. The promise of the construction of a border wall, countless deportations, ill-treatment for minors on the border, among others, provoked an unstable diplomatic relationship during the mandate of Enrique Peña Nieto.

However, the new president-elect has said that relations “are good,” according to the Washington Post. He also said that he hopes to get along with his counterpart, creating more and better jobs so that people do not have to emigrate. “We are in constant communication, and communication is good,” stated.

Is López Obrador trying to contain possible negative commercial effects? It is possible. Being a nationalist leader, taking power after the departure of Peña Nieto, from Right Center, the most logical thing for him to do is to contain.

On the other hand, and this is very important, Trump and López Obrador have a meeting point: both are nationalists. For Dr. Rodríguez Edeza, in Trump’s case, his choice, in some way, was largely based on the promise “Americans First”; and concerning López Obrador, one of his recurring phrases is that “the best foreign policy is the inside one”.

However, will this help them in making business decisions? Dr. Rodríguez Edeza believes that this tendency towards nationalism “does not mean that the doors will close, but that there will be a more cautious, protective and careful attitude” at the international level.

Mexico as “enemy” of the United States

This is a political campaign strategy. He helped Trump win votes from xenophobic and nationalist groups; and injured Peña Nieto in his re-election.

We are talking about two leaders whose nationalist governments have decided to advocate for people. And this might or might not be a meeting point. In the end, they both say they want the best for their states.