Facing Trump’s Threats, Mexico and Canada Draw Closer. Will It Last?

August 20, 2025

By: Emiliano Rodríguez Mega & Ian Austen
Source: The New York Times

Mexico and Canada have long viewed each other with indifference or even distrust. They’re now talking about teaming up.

President Claudia Sheinbaum of Mexico with Prime Minister Mark Carney of Canada in June during a summit of the Group of 7 nations in Kananaskis, Alberta. Credit: Amber Bracken/Reuters

Mexico and Canada, pushed into a three-nation trade deal by their powerful neighbor in between, have for decades viewed each other with a mix of disinterest and distrust.

Now, their leaders, driven by President Trump’s extensive new tariffs and threats to their countries’ sovereignty, are talking about ways to team up.

“It’s very much an all-hands-on-deck approach to ensure that we are kick-starting” the relationship, Canada’s foreign affairs minister, Anita Anand, told reporters this month, alongside Finance Minister François-Philippe Champagne.

“It sends a very strong signal when you have the foreign minister of a country and the finance minister come,” Mr. Champagne added. “I think that message is understood loud and clear in Mexico City.”

This month, the two Canadian officials led a delegation there to meet with President Claudia Sheinbaum of Mexico and prepare for a fall visit by Prime Minister Mark Carney of Canada. The encounter was largely seen as a chance to reset the relationship and compare notes for dealing with an increasingly aggressive Trump administration.

“What we have in common right now is a nefarious neighbor,” said Arturo Santa-Cruz, an expert on North American relations at the University of Guadalajara. “It makes a lot of sense that we collaborate.”

Just days before the trip, Mr. Trump suspended talks with Canada and punished the country with 35 percent tariffs, while offering Ms. Sheinbaum a 90-day extension to trade negotiations.

“I think he respects us,” Ms. Sheinbaum later told reporters. “And we respect him like neighbors.”

But the meetings this month suggest that neither Canada nor Mexico wants to rely on an unpredictable United States alone.

Historically, the two have had only distant economic and cultural ties, despite being trade deal partners. Mexico accounted for 1 percent of Canadian exports last year, and Canada represents around 3 percent of Mexico’s export market.

“This ménage à trois was made out of convenience, not love,” said Antonio Ortiz Mena, a professor at Georgetown University who held advisory roles as part of Mexico’s negotiating team in talks for the North American Free Trade Agreement of 1994. “Both countries, Canada and Mexico, have privileged the relationship with the giant in the middle rather than the relationship between us.”

For some, a sense of mistrust lingers. In much of Ontario, for example, Mexican factories are viewed as job stealers: As investment in auto plants flowed to Mexico and the southern United States over the years, production in Canada fell to 1.3 million vehicles last year from its peak of 2.9 million 25 years ago.

Recent frictions have also strained ties.

After Mr. Trump was elected in November, several Canadian politicians suggested that it may be time to leave Mexico behind and return to a one-on-one trade deal with the United States.

That idea vanished after Mr. Carney took office. He has stressed the importance of keeping all three countries in any deal, an opinion shared by Ms. Sheinbaum.

A few years after Canada and the United States signed a free trade deal, President George H.W. Bush opened negotiations with Mexico. Concerned that its new trade gains might be swiftly eroded, Canada joined the process. The result was NAFTA, which was altered to become the United States-Mexico-Canada Agreement championed by Mr. Trump.

Given that history, some analysts wonder whether recent talks will translate into concrete action, especially as a review of the U.S.M.C.A. approaches.

Even if Mexico and Canada manage to agree on an approach to maintain the trade deal — while trying to avoid the perception that the two countries are ganging up on the United States — there’s always the possibility that Mr. Trump chooses not to honor the terms, said Carlo Dade, a director at the University of Calgary’s School of Public Policy in Alberta.

The safest bet could be to persuade influential political and economic players in the United States that they have strong interests in protecting the region’s trade balance.

“The only thing that can contain Trump is America’s own powerful domestic actors; it’s the governors, it’s the big businessmen, it’s the party leaders,” said Jorge Schiavon, vice president of the Mexican Council on Foreign Affairs. “They are selfish allies, but they are those who defended the renegotiation in 2018, and they would do it again in 2025.”

The review of the 2020 agreement is set for next year, though Mexican officials have said consultations could begin as soon as this fall.

Some analysts and businesses also see hope for better trade, saying that Mr. Trump has at least somewhat respected the pact from his first term.

Nearly all exports traded under that deal are free of the 25 percent U.S. tariffs imposed on Mexican goods and the 35 percent tariffs on Canadian ones.

“It’s really a saving grace for Canada and Mexico,” said Jesse Rogers, an economist leading research on Latin America for Moody’s Analytics.

A recent study by his firm found that the effective tariff rate for both countries was around 13 percent. Without the exemption granted by the Trump administration, Mr. Rogers estimates, that would increase to around 40 percent for Canada and 32 percent for Mexico.

Emiliano Rodríguez Mega is a reporter and researcher for The Times based in Mexico City, covering Mexico, Central America and the Caribbean.

Ian Austen reports on Canada for The Times. A Windsor, Ontario, native now based in Ottawa, he has reported on the country for two decades.

Consulta la nota aquí: The New York Times

US Sanctions Mexican Banks in Fentanyl Crackdown, Fueling Bilateral Tensions

Actualizado: 29 jul 2025

July 3, 2025
Interviewer: Natalia Hidalgo
Source: Insight Crime

The US government recently sanctioned three Mexican financial institutions for allegedly laundering drug money, adding to a series of US actions that have strained the country’s bilateral crime-fighting relationship with Mexico.

On June 25, the US Treasury Department’s Financial Enforcement Network (FinCEN) sanctioned two major Mexican banks and one brokerage for allegedly laundering money for Mexican criminal organizations and helping purchase fentanyl precursors from China.

These sanctions represent FinCEN’s first actions under the Fentanyl Sanctions Act and the FEND Off Fentanyl Act. The latter empowers the US Treasury for the first time to sanction foreign individuals or entities involved in money laundering specifically linked to opioid trafficking, including fentanyl.

In a statement, the US Treasury accused CiBanco, Intercam, and Vector Casa de Bolsa of carrying out dozens of small-scale financial transfers over several years on behalf of the Jalisco Cartel New Generation, the Sinaloa Cartel, the Gulf Cartel, and the Beltrán Leyva Organization.

The FinCEN orders cite the entities’ roles in processing payments for precursor chemicals sourced from China, allegedly used to produce fentanyl.

All three institutions issued public statements denying any links with money laundering on behalf of Mexican-based criminal groups.

She said the transactions flagged by FinCEN involved “legally established” Mexican and Chinese companies, and the data pointed to records of transfers — not evidence of money laundering.

Mexico’s Finance Ministry has since launched an investigation into the three institutions. In a public statement, the ministry said it had requested proof linking the financial firms to any illegal activities, but that “no evidence was received.”

InSight Crime Analysis

The US sanctions represent another unilateral attempt by the United States to crack down on transnational organized crime and fentanyl trafficking, which is straining the bilateral relationship.

“These types of actions fuel a narrative of asymmetry and imposition, with Mexico being treated more as a territory under suspicion than as a strategic partner,” said security analyst Eunice Rendón. “That has an immediate impact on the willingness of local authorities, financial institutions, and justice system actors to actively cooperate in cross-border investigations.”

In the short term, targeting financial institutions directly or indirectly involved in illicit operations might deter or disrupt some organized crime flows. Once a financial institution is labeled a “primary money laundering concern,” it is, in practice, effectively cut off from the global financial system.

However, Rendón said these actions undermine the Mexican government’s ability to investigate, prevent, and sanction these activities under its legal framework.

The FinCEN sanctions follow a string of unilateral US actions aimed at dismantling Mexican criminal organizations. In July 2024, US authorities arrested Ismael Zambada García, alias “El Mayo,” one of the founding figures of the Sinaloa Cartel, and Joaquín Guzmán López, joint leader of the group’s Chapitos faction.

While the US hailed the arrests as a hollow victory in countering cross-border smuggling, the operation quickly became mired in controversy.

Mexican authorities voiced frustration at the surprise nature of the arrests and questioned the role of US authorities in the arrest, launching their own investigation into potential violations of immigration and customs laws, and the alleged kidnapping of El Mayo by Guzmán López.

The arrest eroded bilateral trust on security cooperation and unleashed a violent internal war for control within the Sinaloa Cartel, one of Mexico’s most formidable crime groups — destabilizing the state of Sinaloa and leaving Sheinbaum to manage the resulting human and economic crisis.

Then, in February 2025, the Trump administration designated six major Mexican criminal organizations as Foreign Terrorist Organizations. He also threatened to impose tariffs on Mexican imports unless tougher action was taken to curb the flow of fentanyl and migrants.

Just days before the announcement, US Attorney General Pamela Bondi labeled Mexico an “adversary” during a Senate hearing, and declined to answer whether Sheinbaum was cooperating satisfactorily on security matters.

Sheinbaum has expressed a willingness to support increased cooperation to fight drug smuggling and irregular migration. Unlike her predecessor, President Andrés Manuel López Obrador, Sheinbaum has sought to appease her US counterpart by ramping up law-enforcement crackdowns and dispatching troops to the northern border.

“On qualitative terms, cooperation between the current US and Mexico’s governments is stronger than it was under the previous Mexican administration,” said Dr. Antonio Mena-Ortiz, Associate Professor at Georgetown University. “And that should not be overlooked.”

Yet, Trump continues to exert economic and political pressure on Mexico, undermining Sheinbaum’s efforts to build a bilateral security relationship grounded in respect for Mexico’s sovereignty and transparency.

Read the article here: Insight Crime