In a surprise announcement that could compromise a major trade deal, President Donald Trump announced on Thursday that he is slapping a five percent tariff on all Mexican imports to pressure the country to do more to crack down on the surge of Central American migrants trying to cross the US border.
He said the percentage will gradually increase "until the Illegal Immigration problem is remedied."
Trump made the announcement after telling reporters earlier Thursday that he was planning "a major statement" that would be his "biggest" so far on the border.
"On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied," he wrote, "at which time the Tariffs will be removed."
Trump's move to impose a five percent tariff on all Mexican goods in response to migrant border crossings would be "disastrous," Mexico's top diplomat for North America said Thursday, vowing to retaliate.
"It's disastrous. If this threat is carried out, it would be extremely serious," said Jesus Seade, under-secretary for North American affairs at the Mexican foreign ministry.
"If this is put in place, we must respond vigorously," he told a press conference.
Trump has accused the Mexican government of failing to do enough to crack down on the surge of Central American migrants who have been flowing to the US in search of asylum from countries including El Salvador, Honduras and Guatemala.
The announcement comes as the administration has been pushing for passage of the United States-Mexico-Canada Agreement that would update the North American Free Trade Agreement.
The tariff threat also comes at a time when Mexican authorities have been carrying out migrant raids and detaining thousands more who are travelling through the country on the way to the US.
TRT World speaks to Washington-based journalist Daniel Ryntjes.
Mexico's crackdown on migrants
The crumbling city of Tapachula, near the Guatemalan border, has become the epicentre of the crackdowns. Thousands of migrants have been stranded in the city because the Mexican government isn't providing them visas that allow them to travel.
Authorities this week have been clearing out parks of camping migrants and raiding hotels where immigrants were staying.
Mexican authorities raided and largely broke up the last major migrant caravan, detaining hundreds of immigrants from Central America.
And the Mexican government has allowed the US to return hundreds of asylum seekers from Central America and other countries to force them to wait their cases out in Mexico — in one of only a few immigration policies that have not been immediately struck down by the courts.
The White House said Trump would be using the International Emergency Economic Powers Act to implement the tariff.
"If the illegal migration crisis is alleviated through effective actions taken by Mexico, to be determined in our sole discretion and judgment, the Tariffs will be removed," the White House said in a statement.
But if Trump is not satisfied, the five percent figure will increase to 10 percent on July 1, to 15 percent on August 1, to 20 percent on September 1 and to 25 percent on October 1, the White House said.
"Tariffs will permanently remain at the 25 percent level unless and until Mexico substantially stops the illegal inflow of aliens coming through its territory," the statement read.
Mexico and Congress need to do more - Pence
During a visit to Canada on Thursday, Vice President Mike Pence vowed the deal would be passed this year.
"Our administration is working earnestly with leaders in the Congress of the United States to approve the USMCA this summer," he said. Asked by reporters about the new tariff consideration, Pence said that both Mexico and Congress need to do more and that Trump is determined to use his authority to call on them to do so.
Trump had said Thursday morning that he was planning "a big-league statement" later Thursday or Friday regarding the border.
"We are going to do something very dramatic on the border because people are coming into our country.
The Democrats will not give us laws," he said as he headed to a commencement speech for 2019 United States Air Force Academy graduates.
Reaction to decision
In Mexico, which sends 80 percent of its exports to the United States, the reaction was a mix of incredulity and anger.
Seade had been planning to hold an upbeat press conference to mark the start of the ratification process this week for the United States-Mexico-Canada (USMCA) agreement, the new trade deal intended to replace Trump's much-hated NAFTA.
Instead, it turned into a bitter reaction to Trump's tariff announcement.
"There is no justification for doing this over migration," said Seade. "The right thing to do would be to say, 'An eye for an eye,' but that would just mean everyone ends up in the jungle."
Seade said the announcement had taken Mexico by surprise, even though Trump had tweeted earlier in the day that he was planning a "dramatic" policy announcement about the border.
"It was impossible to foresee something of this magnitude... We didn't see this coming," he said. "We will have to discuss this with the United States and decide amongst ourselves how to respond."
Seade, who was President Andres Manuel Lopez Obrador's top delegate to the USMCA talks when the latter was president-elect, had thus far navigated relations with the Trump administration relatively smoothly.
The same is true of Lopez Obrador, an anti-establishment leftist who won a landslide election victory last year. He has so far brushed off Trump's repeated attacks on Mexico, refusing to be dragged into a fight.
Seade said that would not do this time.
"I'm not going to let the president (Lopez Obrador) say, 'I'm not going to respond,'" he said.