THE USA’S TRADE LEVERAGE OVER MEXICO

Let me make this as easy to understand as possible.

In 2015, the latest full year we have data for:

-Mexico exported $380 billion dollars in goods.  $309 billion – 81% – of its exports are to the United States.

-Mexico imported $395 billion dollars in goods.  $187 billion – 48% – of its imports are from the United States.

Given that Mexico is far more reliant on the United States as a market for goods and services than the United States is as a market for Mexican goods and services, Is there any realistic way that Mexico can successfully fight a trade war with the United States?

No. Not a chance.

Does this mean that, with all the bravado coming from its current President, Enrique Pena Nieto, and its previous President, Vicente Fox, Mexico is going to have to sit down with President Trump and work something out – something beneficial to the USA?

Almost certainly yes.  It would border on economic suicide for Mexico not to.

I hope this has been helpful.

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