The Mexican Gross Domestic Product (GDP) could be negatively affected in the coming years if Donald Trump is re-elected as president of the United States, experts warned. Dana Bodnar, an economist at Atradius, explained that under Trump's administration, Mexico's GDP would be up to 2 percent lower by 2026 and Foreign Direct Investment (FDI) would remain stagnant compared to a scenario under Kamala Harris's government.
Bodnar pointed out that Trump's trade policy would focus on imposing hefty tariffs on imports, not only from China but also from other major trading partners of the United States. Moody's Ratings warned that if the United States imposed a general tariff of 10 percent on all global imports in Trump's first year, the Mexican economy would be paralyzed by 2025 and would slowly recover by 2026.
The rating agency also warned about the negative impact on both the Mexican and U.S. economies if the proposed tariffs materialize. There is concern that these tariffs could be used as a strategy to affect Chinese exports, which has caused unease in political circles of both parties.
Esteban Polidura, head of Investment Strategy for the Americas at Julius Baer, expressed that although Trump's trade policy is more intense than Harris's, he dismisses a significant impact on Mexico's GDP. Polidura suggested that tax cuts in the United States could spur growth and indirectly benefit Mexico.
Experts warn that a potential trade war could have serious consequences for the economies of the United States and Mexico, particularly if tariffs affecting vehicle trade are applied and a deterioration in exports is triggered. The danger of a buildup of tariffs in the vehicle supply chain is highlighted, which could harm global trade.
Jason Tuvey of Capital Economics warned that Trump's threats to impose tariffs on Mexico's automotive sector could be a pre-election political tactic or a strategy to gain concessions.
