Chinese vendors, Mexican clients commiserate on Trump tariffs at trade expo

People attend the China Homelife Mexico fair in Mexico City taken on June 4, 2019. — AFP pic
People attend the China Homelife Mexico fair in Mexico City taken on June 4, 2019. — AFP pic

MEXICO CITY, June 8 — Huang Chao came to Mexico looking for business, not friends, but the Chinese sales manager says he found unexpected common ground with his prospective clients on one thing: Donald Trump “is crazy.”

Chao, 31, was in Mexico City this week representing his textile company at a trade fair called Expo China HomeLife, whose goal is to connect Chinese suppliers with merchants in different countries around the world.

Mexico was set to be just another stop for the enormous expo — until the US president threatened last week to impose five-per cent tariffs on all Mexican imports.

The tariffs are due to start Monday and rise in monthly increments to 25 per cent by October, unless Mexico slows the US-bound flow of undocumented migrants to Trump’s satisfaction.

That effectively made Mexico the second major front after China in Trump’s spiraling trade wars.

It also gave vendors and customers in Mexico City a new topic to discuss in stilted English as they brokered deals for mass quantities of home articles, plastic accessories, cheap decorations, cloth and other myriad products the Asian powerhouse exports to the world.

Trump’s tariffs “aren’t just hurting China, they’re hurting the whole world,” Huang told AFP.

“He is hurting both countries’ feelings,” said businesswoman Louisa Chin, 30, referring to Mexico and China.

“He knows how to rile up his voters,” said Alejandro Becerril, a Mexican builder, after an animated conversation with a group of Chinese business executives.

“He’s trying to get Mexico to toughen up its migration policies — and it’s working.”

My enemy’s enemy...

The United States is already deep into a trade and technological battle with China.

Last month Washington raised tariffs on US$200 billion (RM829.6 billion) in Chinese goods to 25 per cent. Beijing hit back with retaliatory tariffs of five to 25 per cent on US$60 billion in US goods.

Trump is threatening to expand the tariffs to essentially all Chinese imports, and has also moved to blacklist a Chinese tech giant, Huawei, over national security concerns.

The spat had been beneficial for Mexico, which has replaced China as the top US trading partner so far this year.

But now Mexico is getting a taste of what Beijing calls Trump’s “economic terrorism” — pushing the US neighbour closer to China.

“In the current global context, there are many things China and Mexico can do together,” Lo Tu, deputy mayor of the Chinese city of Shantou, said in Mexico City.

“Mexico and China are friends and partners. Mexico can be stronger with China, and China can be stronger with Mexico,” Mexico’s Undersecretary for Foreign Trade Luz Maria de la Mora said during a visit to China this week.

This is not the first time Mexico — long used to living in the shadow of its giant northern neighbour — has eyed closer ties with China when its trade relationship with the US frays.

There was a similar effect when Trump threatened to rescind the North American Free Trade Agreement (Nafta) between the US, Mexico and Canada.

Mexico sends nearly 80 per cent of its exports to the US, and the countries do more than US$600 billion a year in bilateral trade, according to Washington.

The world’s second-largest economy is an obvious place for Mexico to turn to try to diversify its trade portfolio.

In 2017, Mexico and China did US$80.9 billion in two-way trade, according to Mexico’s central bank. But the bulk of it was Chinese exports to Mexico: US$74.1 billion.

Mexican officials will have to do more to cultivate ties with Beijing if they truly want to deepen the relationship, said China expert Enrique Dussel of Mexico’s largest university, UNAM.

“Mexican officials always seem to be saying, ‘China will help us out of the ditch,’” said Dussel.

“But we have to be more serious about the relationship,” he added.

“Whenever Trump sticks his tongue out at us on Monday, we turn to China on Tuesday. Then Trump lifts the tariffs on Wednesday, and on Thursday we forget about China. That’s not how you manage a relationship with a country” like China, he said.

Still, ties are growing. A record 1,600 companies attended the trade fair this year — up 500 from last year. — Reuters

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