Mexico was the foreign country with the most riding on the 2016 U.S. presidential election.
Eventual winner Donald Trump launched his campaign last year by declaring he’d “build a wall” on the border between the two countries and force Mexico to pay for it. He also repeatedly promised to deport millions of undocumented immigrants.
The proposals electrified his supporters, but they flew in the face of 25 years of friendly relations and trade deals between Mexico and the United States. Now, facing the certainty of a Trump presidency, Mexicans have little to do but look for a positive spin on the election result.
“It’s time for Mexicans to ‘turn on their batteries,’” said prominent Mexico City civil liberties attorney Jesus Robles Maloof. He was using a Mexican phrase that means relying on one’s ingenuity and drive in the face of challenges.
Amid the shock of Trump’s victory, there were signs that Mexico’s leaders were moving to forge a workable relationship with the president-elect. In an address to the country on Wednesday, Mexican President Enrique Peña Nieto said he spoke to Trump and congratulated him on his win against Hillary Clinton. Peña Nieto promised that Mexico and the U.S. would remain “partners.”
Peña had provoked wrath and mockery from Mexican citizens for welcoming Trump the candidate to his presidential residence in August. His approval ratings plummeted.
“When things go well for Mexico, things go well for the U.S. as well,” Peña Nieto said Wednesday. “And when things go well for the U.S., they do too for Mexico.”
The reverse also seems to be true.
During the campaign, the peso became an unofficial bellwether of the two major candidates’ fortunes north of the border. As Trump rose in polls, the peso dipped in value against the dollar over fears of Trump’s proposed protectionist policies.
The currency, one of the most traded in the world, reached its lowest point against the dollar when Trump’s victory began to look assured, hitting 20.7 per one dollar — a loss of more than 13 percent in a matter of hours — late Tuesday. The drop was short-lived, however; by Thursday morning, the peso had gained back almost all the value it had lost.
If a Trump administration does negatively affect the peso over the next four years, however, it might actually attract more U.S. investment, said Alejandro Cervantes, senior financial analyst at Banorte in Mexico City. Mexico’s wages are already lower than China’s, and it will be difficult for Trump to bring back certain jobs to America as he’s promised.
“Even if he imposes tax cuts and incentivizes these companies to operate inside the United States, even if you subsidize them, it is still much cheaper to produce in Mexico,” Cervantes said.
After the inception of the North American Free Trade Agreement in 1994, two major shifts between the neighbors occurred. Mexico became America’s third-largest goods trading partner after China and Canada, thanks in part to Mexico’s strong automotive industry. And Mexico became the top source of both illegal and legal immigration to the U.S.
“We might have to get closer to China and Southeast Asia, and with the rest of the Americas.”
The 20-year wave of immigration that fundamentally changed the demographics of the U.S. fueled Trump’s incendiary rhetoric against Mexico. Nevertheless, the idea that Trump would fulfill his promise of building a wall along the nearly 2,000-miles U.S.-Mexico border was met with chuckles in Mexico this week.
“That wall is pure bluff,” said visual artist Pedro Reyes, whose recent “political haunted house” art installation in New York satirized U.S. political culture. “Obligating Mexico to pay for it is impossible. That was nothing more than a campaign slogan, like ‘Lock her up.’”
On the campaign trail, Trump said he would force Mexico to “pay for the wall” by imposing taxes on remittances, the cash Mexican laborers send to relatives back home. Remittances are the second biggest source of income in the country after its oil, and helped Mexico weather the global recession.
Cervantes argued it would be impossible to monitor these transactions, because 90 percent of them occur in established intra-bank transfers, not wire transfers. There’s no way of knowing if these transfers are remittances or some other kind of payment.
Robles, who is also a columnist known for writing critically of the Peña government, said Mexico will survive a Trump presidency, but not without some bruises.
“If Trump wants to force the auto industries to return to Michigan, he will screw over entire [Mexican] states, like the State of Mexico, Puebla, others,” Robles said, citing places where Ford and General Motors operate factories. “But there can be other opportunities… in Europe. We might have to get closer to China and Southeast Asia… and with the rest of the Americas.”
After finishing his speech, Peña Nieto briefly returned to his podium and appeared to be speaking candidly — rare for the famously on-message president.
“I want to repeat,” he said with a weary-seeming smile. “I think we’re opening a new chapter in the relationship with the United States and a new era that we want to consolidate, with trust and mutual respect, and a relationship that I am certain will permit us to construct prosperity for both societies.”