Trudeau’s willingness to cut a trade deal with U.S. alone was a betrayal, Mexico’s lead negotiator says

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Prime Minister Justin Trudeau’s willingness to cut a trade deal with the U.S. alone came as a betrayal, says Mexico’s lead trade negotiator, adding that it has already proven to be a mistake.

Any desire by Canada to divert blame toward Mexico for U.S. problems with illegal immigration and imported narcotics was “erroneous,” Luis Rosendo Gutiérrez Romano said in an interview this week.

Donald Trump’s promise of 25-per-cent tariffs against both Canada and Mexico suggests that for the incoming U.S. president, “the problem is on both sides,” he said. Canada “fought with Mexico and they did not achieve anything.”

Mr. Trudeau last week said he had concerns about Chinese investment in Mexico, saying if those were not addressed “we may have to look at other options” rather than maintaining a united North American market.

Mexico has moved quickly to address Mr. Trump’s concerns directly. On Wednesday, Mexico’s President Claudia Sheinbaum spoke with the president-elect. Mr. Trump on social media called it a “wonderful conversation,” in which Ms. Sheinbaum had agreed to “stop Migration through Mexico, and into the United States, effectively closing our Southern Border.”

At the same time, Mexico’s trade negotiators say they remain committed to working with Canada to maintain the trilateral co-operation that has governed continental trade since the North American free-trade agreement came into force in 1994.

“It is not rational to be divided against the United States,” Mr. Gutiérrez Romano said in an interview in Vancouver, where he met with Canadian government officials. The suggestion from Mr. Trudeau that Ottawa could deal directly with Washington felt “like a betrayal,” he said.

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The Prime Minister’s Office declined to comment, referring a request to the minister for international trade, whose office did not respond by Thursday evening.

Mexico has assigned a low likelihood of probability that Mr. Trump will carry through with his promised tariffs.

But, Mr. Gutiérrez Romano said, Mr. Trump’s tariff plans indicate there is a need to move quickly on talks toward renewing the United States–Mexico–Canada Agreement that was struck during Mr. Trump’s first term as a successor to NAFTA. A joint review of that agreement is scheduled for 2026. If the three countries do not agree, a 10-year countdown will begin toward the deal’s expiry.

Mexico now sees a chance to conclude that review early. “There is a big possibility that we close the negotiation before 2026,” he said.

“Trump accelerated the process, and for us maybe that is even better,” he added. The alternative is an additional period spent waiting, and “all this time is uncertainty.”

In Mr. Trump’s social-media post pledging 25-per-cent tariffs on all goods imported to the U.S. from Canada and Mexico, he said the “Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”

For Mexico, the key to protecting trade with the U.S. is to find ways to satisfy Mr. Trump’s demands on drugs and migration, Mr. Gutiérrez Romano said.

But, he acknowledged, “we really don’t know” how to do that.

He likened the strategic considerations around North American free trade to a prisoner’s dilemma, where co-operation yields the best results. If any of the parties backs out, “we all lose.”

Mexico has already worked to slow the northward flow of people, interdicting greater numbers of migrants entering from Guatemala, offering escorted transport to the border for those entering the U.S. lawfully – and busing south others who do not have permission to cross into the U.S.

It has also sought to address concerns about Chinese investment in Mexico, which Mr. Gutiérrez Romano called a “false narrative.”

Chinese investment in Mexico grew twentyfold between 2018 and 2023. Chinese exports to Mexico have risen 151 per cent since 2016, with sales of Chinese-brand vehicles rising quickly.

But Mexico receives only a small fraction of foreign direct investment in North America, while the U.S. is by far China’s largest export market. Mexico, meanwhile, last year surpassed China as the largest source for imports into the U.S.

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Last year, Mexico imposed a 25-per-cent tariff on Chinese-made electric vehicles. While that falls short of the 100-per-cent levy mandated by Canada and the U.S., the only Chinese-brand automotive manufacturing facility on the continent is in California, where BYD North America manufactures buses.

Several Chinese automakers have publicly discussed plans to begin manufacturing in Mexico.

Mr. Gutiérrez Romano argued that any policy toward his country needs to be grounded in fairness.

“You cannot tell Mexico: ‘I don’t want you to have a factory for Chinese vehicles, but I can.’”

Mexican authorities have nonetheless begun work toward creation of an investment-screening authority with power similar to those under the Investment Canada Act or the Committee on Foreign Investment in the United States.

Mr. Gutiérrez Romano previously served as treasurer of Mexico City under Marcelo Ebrard, who was then the capital’s mayor and is now the country’s Economy Minister.

After Ms. Sheinbaum was sworn in as President on Oct. 1, Mr. Gutiérrez Romano was named undersecretary for international trade.

In his first three weeks in that mandate, he travelled to Ottawa and Washington.

“Why? Because we want to follow the same rules as North America for the investment-screening process,” he said.

“I think that this is the best signal that we want to work together with Canada and the United States against any external pressure from Asia or from other parts of the world.”

Mr. Trump has threatened heavy tariffs on products made by U.S. companies that divert employment to Mexico, pledging during his presidential campaign that the U.S., under his leadership would “take other countries’ jobs.”

But Mexico is hoping to attract more higher-value manufacturing, positioning itself as a low-cost alternative to China in sensitive industries such as semi-conductors and batteries.

The U.S. has spent heavily to bring such production inside its own borders. Under President Joe Biden, the CHIPS and Science Act offered tens of billions of dollars in subsidies and tax credits to woo high-tech plants onto American soil. Mr. Trump has criticized that plan, but has also spoken out against Taiwan for having “stole[n] our chip business.”

Mexico argues that efforts to bolster North American chip output cannot succeed in competing against overseas production with high-cost labour.

“You need me,” Mr. Gutiérrez Romano said. “You need me because we are more competitive in terms of cost.”