Mexican meeting cancelled as Trump considers import tax to pay for wall
Mexican President Enrique Pena Nieto has cancelled a planned meeting with President Donald Trump, signalling a remarkable souring of relations between Washington and one of its most important international partners just days into the new administration.
The rift capped days of increasingly confrontational remarks - on Twitter and in duelling public appearances - between the two men, whose countries conduct some 1.6 billion dollars a day in cross-border trade, and co-operate on everything from migration to anti-drug enforcement to environmental issues.
Hours after Mr Trump tweeted that the meeting should be scrapped if Mexico does not agree to pay for a wall along the nearly 2,000-mile border, Mr Pena Nieto responded via the same platform.
"This morning we have informed the White House I will not attend the working meeting planned for next Tuesday," the Mexican president tweeted.
He added that "Mexico reaffirms its willingness to work with the United States to reach agreements that benefit both nations".
In a speech later, Mr Trump doubled down on the dispute, saying that "unless Mexico is going to treat the United States fairly, with respect, such a meeting would be fruitless, and I want to go a different route. We have no choice".
Mr Trump also claimed that calling off the meeting was a mutual decision and floated a new possible threat to Mexico, which sends about 80% of its exports to the US and which has vowed not to pay for a wall.
"We're working on a tax reform Bill that will reduce our trade deficit, increase American exports and will generate revenue from Mexico that will pay for the wall, if we decide to go that route," Mr Trump said.
His spokesman later said Mr Trump was calling for a 20% tax on imports to pay for the southern wall.
He has also pledged to renegotiate the North American Free Trade Agreement with Mexico and Canada.
"I will not allow the citizens or the taxpayers of the United States to pay the cost of this defective transaction, NAFTA, one that should have been renegotiated many years ago, except that the politicians were too preoccupied to do so," Mr Trump said.
Mexican officials have expressed willingness to update the pact, but said they would consider walking away from NAFTA if negotiations mean making too many concessions.
Mexico is one of America's biggest trade partners, and the US is the number one buyer from Mexico, accounting for about 80% of Mexican exports.
A complete rupture in ties could be damaging to the US economy and disastrous for Mexico's.
"Today's events are dangerous for the immediate and long-term security and economy of the United States," Jason Marczak, of the Atlantic Council, wrote.
"US-Mexico co-operation is far-reaching: from intelligence sharing for the capture of drug traffickers to the flow of commercial goods that support the livelihoods of nearly five million American workers."
White House press secretary Sean Spicer later responded to the Mexican president's tweet, saying: "We'll look for a date to schedule something in the future. We will keep the lines of communication open."
Mr Pena Nieto's decision ended days of uncertainty about how he would respond to Mr Trump's aggressive stance towards the country, and illustrated the challenges world leaders are likely to face in dealing with the US president's voluble, Twitter-based diplomacy.
The diplomatic row also recalls the rocky days of US-Mexico relations in the 1980s, prior to NAFTA.
"There is a change in the understanding that had been in operation over the last 22 years, when Mexico was considered a strategic ally," said Isidro Morales, a political scientist at the Monterrey Institute of Technology and Higher Education.
"Trump has unilaterally broken with this way of doing things."
Mexico had tried its traditional approach of quiet, cautious diplomacy combined with back-room discussions, sending cabinet officials for talks with the Trump administration.
But that changed when Mr Trump decided to announce his border wall on the same day that two senior Mexican cabinet ministers - foreign relations secretary Luis Videgaray and economy secretary Ildefonso Guajardo - arrived in Washington for preliminary talks ahead of what was to be a presidential tete-a-tete.
Many were affronted by the timing, and Mr Pena Nieto faced a firestorm of criticism at home.
That evening Mr Pena Nieto issued recorded remarks suggesting he was reconsidering his upcoming trip to Washington.
On Thursday morning, Mr Trump tweeted: "If Mexico is unwilling to pay for the badly needed wall, then it would be better to cancel."
The president had "no other choice but to say 'I'm not going'", former foreign relations secretary Jorge Castaneda told Mexican media.
Already deeply unpopular at home with historic-low approval ratings, Mr Pena Nieto had come under increasing pressure to stand up to Mr Trump.
Mexico's best-known opposition politician, leftist Andres Manuel Lopez Obrador, tweeted that "in the face of Trump's latest outburst, don't go to the meeting, and submit an urgent complaint to the UN for human rights violations".
Many Mexicans said that they backed Mr Pena Nieto's decision to scrap the trip.
Magda Hoffmann, a Mexico City retiree, called Mr Trump's behaviour "insulting and rude".
"As my grandmother said," she added, "'Don't go where you're not invited.'"
Like many, she found the conduct of diplomacy-by-tweets to be odd.
"This is a diplomatic relationship here. I'm sorry, gentlemen, but that has to be given value," Ms Hoffman said. "It's not a question to be handled ... text-messaging back and forth."
Orlando Contreras, a 35-year-old computer engineer in the capital, said he believed Mr Pena Nieto had no reason to "negotiate under their conditions".
"I feel that we have always been under their (the US) yoke," Mr Contreras said.
"I think it would be a good thing to separate ourselves from them, so Mexico can strike out on its own."