MEXICO CITY — Just one week into his second term, President Donald Trump unveiled a series of executive orders to initiate an era of radical change. Several of the most significant measures impact Mexico and could strain diplomatic relations between the two countries.
Trump has already declared a “national emergency” at the southern border, directed U.S. troops to seal it, and reinstated the “Remain in Mexico” policy. He also designated drug cartels as terrorist organizations and threatened to impose new tariffs on Mexican imports. Taken as a whole, Trump’s threats and aims present a fresh array of difficulties for Mexico and President Claudia Sheinbaum. While his ardent rhetoric and accusations are not new—he used them repeatedly on the campaign trial—their scope and potential repercussions give reason for caution.
Sending undocumented Mexicans back to Mexico has already created friction between the two countries, and similar tensions arose in Colombia on Sunday. President Gustavo Petro said Colombia would not allow U.S. deportation flights to land, alleging inhumane treatment of detainees and rejecting the use of military aircraft for repatriations. After Trump responded with threats of immediate tariffs, the two countries quickly came to an agreement to resume the flights. Meanwhile, in Brazil, officials demanded that U.S. agents remove handcuffs from a group of deportees who were flown there on Friday.
These cases illustrate how sensitive the immigration issue can become for Mexico and other countries in the Western Hemisphere. Mexico’s central dilemma is how to navigate this renewed era of pressure and uncertainty. As Trump resorts to a carrot-and-stick approach, Mexico must weigh its options carefully and strike a delicate balance between mutually beneficial cooperation and self-preservation.
The migration challenge
The Trump administration’s aggressive stance on immigration presents an immediate challenge. Its mass deportation plans will place increasing pressure on Mexican border cities and leave millions of undocumented migrants—including approximately 4 million Mexicans in the U.S.—fearing for their future. Mexican negotiators will face the daunting task of ensuring that deportations of Mexicans from the U.S.—and foreign nationals from Mexico—proceed in an orderly manner while also safeguarding migrant rights.
To prepare for an expected wave of Mexicans deported from the U.S., Mexico is rolling out an initiative called “Mexico Embraces You” that will establish nine reception centers along the border equipped with mobile kitchens operated by the armed forces. Multiple federal agencies and state governments will coordinate to transport returnees to their hometowns, provide medical assistance, and enroll them in social welfare programs, among other support measures. Returnees will also receive prepaid cards worth $100 from the government. Even so, these measures are insufficient in the face of the surge in deportations expected over the coming months and years.
The 53 consulates of Mexico in the U.S. will face an overwhelming task. While the Mexican Foreign Service has developed remarkable capabilities over time, the country’s consular network in the U.S.—by far the largest of any in the world—lacks human and financial resources. President Claudia Sheinbaum’s first federal budget, in effect this year, cut foreign policy spending by 10%, while critical federal migration institutions have chronic institutional weaknesses and remain largely underfunded. In Oaxaca, a southern Mexican state and one of the country’s largest sources of migration, the Institute for Comprehensive Migrant Assistance was just dismantled in 2024.
Meanwhile, the return of the Migration Protection Protocols (MPP), better known as “Remain in Mexico,” a policy Trump first implemented in 2019, forces thousands of third-country nationals to wait on Mexican soil while their asylum cases are processed in the U.S., which can take years. The U.S. immigration system is strained by a backlog of 3.5 million pending cases across 56 immigration courts, and Trump sees this policy as a way to transfer part of the problem to Mexico. But, in doing so, it violates the international legal principle of non-refoulement, which prohibits countries from returning refugees to a nation where their life or freedom would be at risk.
Former President Andrés Manuel López Obrador agreed to the policy in the face of tariff threats from President Trump, and Sheinbaum has little choice but to acquiesce. This will amount to a massive humanitarian and logistical burden.
Fighting the cartels
Trump’s decision to designate drug cartels as terrorist organizations is ostensibly meant to address the fentanyl crisis in the U.S. It grants the U.S. government expanded tools like asset freezing and sanctions, which could dent and disrupt cartel operations. If the designation is used to crack down on cartel financial flows, it could push back against organized crime’s infiltration of both the formal economy and the political system.
However, this unprecedented action also brings substantial risks and was publicly derided by Sheinbaum, who labeled it an affront to Mexico’s sovereignty. She has pressed for more cooperative, less coercive relations and days ago rightly said it was important to “keep a cool head and refer to the signed orders beyond the actual rhetoric.”
The designation could hurt Mexican enterprises as well as U.S. companies operating in Mexico, which could face penalties if they are in any way financially entangled with the cartels’ sprawling money-laundering operations. These networks can be difficult to avoid, given that they have penetrated industries from agriculture to tourism and beyond.
This means that companies will face additional corporate compliance challenges, particularly those related to financial institutions. Foreign investment could be deterred due to excessive regulatory caution. Moreover, even though this measure does not explicitly authorize U.S. military intervention in Mexico, it could pave the way for cross-border operations, undermining the country’s sovereignty and complicating diplomatic relations.
Tariff threats
With bilateral trade reaching nearly $800 billion last year, the economic interdependence between the two nations is undeniable. However, Trump has once again raised the specter of tariffs as a coercive tool. The president said his administration is planning to impose 25% tariffs on Mexico and Canada starting February 1, arguing that these countries allow “mass numbers of people to come in and fentanyl to come in.”
This connection to migration and fentanyl makes it clear that for Trump, tariffs on Mexican products are a means to an end, not an end in themselves.
Rather than imposing across-the-board tariffs, Trump may opt for targeted measures aimed at specific sectors to send a clear message without significantly disrupting U.S. supply chains. Whether he follows through on this threat or not, the uncertainty alone is enough to erode investor confidence in Mexico.
Mexico’s response
Mexico should make it clear to Washington that it is part of the solution, not part of the problem—whether in the context of the U.S.-China rivalry or national security threats. However, to make this case convincingly, Mexico must back its words with concrete actions.
Key to Mexico’s success will be the appointment of a strong, politically backed ambassador to Washington. Esteban Moctezuma, Mexico’s current ambassador to the U.S., is expected to be replaced, and in the meantime, Mexico lacks a powerful diplomatic presence in D.C. With Trump in power, Mexico cannot afford a vacuum in its diplomatic representation. A well-connected and influential envoy will be crucial in navigating the complexities of the new administration.
Moreover, Mexico must resist the temptation of reactionary nationalism. Pragmatism, not populist rhetoric, will be essential in dealing with the difficulties ahead. Mexico must recognize that Trump is a transactional leader who expects tangible results from negotiations. As such, Mexico should have clear deliverables to bring to the table on the issues that concern Trump most: security; migration; and managing and transparently addressing China’s presence in Mexico.
In this new era, Mexico must hope for the best but prepare for the worst. The challenge ahead is historic, but with the right approach, Mexico can weather the storm and solidify its relationship with its biggest trade partner.
ABOUT THE AUTHOR
Brenda Estefan
Reading Time: 5 minutesEstefan is a professor at IPADE Business School in Mexico City and a columnist at Reforma, Mexico’s leading newspaper.
