Panel of Economic Experts Addresses Challenges of Mexico Facing the Trump Administration
The Institute of Latin American Studies (ILAS) at Columbia University, in cooperation with Columbia SIPA and the Institute of Global Politics (IGP), hosted a panel of experts on March 10 for a discussion on US-Mexico relations under the Trump administration. The event featured Alberto Ramos, managing director and head of Latin American Economics Research at Goldman Sachs, Will Freeman, fellow for Latin American Studies at the Council on Foreign Relations, and Viridiana Ríos, journalist for El País and Milenio. Vicky Murillo, director of ILAS and professor of political science and international affairs, moderated the conversation, which analyzed the evolving economic, political, and security dynamics between the two countries and explored the potential impacts of President Donald Trump’s trade policies, Mexico’s response under President Claudia Sheinbaum’s leadership, and the delicate balance of diplomatic and economic interdependence amid rising tensions over migration.
Ramos gave a stark assessment of the consequences Mexico’s vulnerable export-driven economy could be facing. Nearly 80 percent of Mexican exports are directed to the US, making the country extremely sensitive to trade fluctuations, said Ramos, who warned that Trump’s proposed 25 percent tariffs could reduce Mexico’s GDP by up to three percentage points. Ramos also said that the constant uncertainty surrounding potential tariffs might be even more damaging than the tariffs themselves, creating a “corrosive environment for long-term investment, deterring businesses from making significant economic commitments.”
Freeman addressed changes in Mexico’s approach to migration. He discussed the steps President Sheinbaum’s government has taken to control irregular migration amid significant pressure from the Trump administration's aggressive border control stance and explained that Mexico’s actions—coupled with Trump’s rhetoric—has deterred migration through Central America. Freeman pointed to the Darien Gap in Panama as an example – over the last several years, hundreds of thousands of people have crossed annually, but this year only 2,500 people have crossed. “If it continues on that way for the entirety of this year, we'll be talking about just a nose dive in the number of people coming from South America up through Central America and Mexico,” he said.
The panel also discussed President Sheinbaum’s handling of organized crime and the fentanyl crisis, examining how her security policies represent a significant change from those of her predecessor, former President Andrés Manuel López Obrador. Freeman highlighted Mexico’s intensified efforts against drug cartels, including sharp increases in arrests against organized crime groups, drug and weapons seizures, and dismantling of drug labs in the first months of Sheinbaum’s presidency. However, Freeman cautioned against viewing these measures as a simple solution. “Decreasing flows of fentanyl will not fix the problem of organized crime in Mexico," he said, explaining that mounting pressure on cartels could cause them to fragment into more localized criminal activities. He stressed the need for institutional reforms, citing a statistic that revealed that 25 percent of Mexicans believe organized crime holds more power than the government.
Ríos noted President Sheinbaum’s unprecedented 85 percent approval rating, asserting that Sheinbaum has shown a more pragmatic approach than her predecessor to both domestic and international issues. As the discussion wrapped up, the panelists touched on the asymmetrical nature of US-Mexico relations, saying that while Mexico depends more heavily on the US economically, the countries remain deeply interconnected. Ríos expressed optimism about Mexico's potential, suggesting that the current pressures could drive significant economic and industrial policy improvements.
The other panelists shared her perspective, stating that while the challenges are significant, there is still room for hope about the long-term relationship between the US and Mexico. Ultimately, the success of the US-Mexico relationship will depend on leadership's ability to look beyond short-term political narratives and recognize their fundamental economic interdependence. “Over the medium term, Mexico will not disappear from the map,” Ramos said. “Mexico and the US will be key trading partners no matter what, because the economics of the trade between them make a lot of sense.”