Why a Newly Confident Mexico Is in No Rush to Renegotiate NAFTA

2/24/2017 Fortune Magazine

DonaldTrumpPinataMexico is increasingly confident that U.S. President Donald Trump will not be able to impose harsh barriers on imports anytime soon, and officials signaled they may hit their northern neighbor’s most trade-sensitive districts in case he does.

Trump wants to renegotiate the North American Free Trade Agreement with Mexico and Canada, but talks cannot begin until he triggers a 90-day notice period by informing Congress. Nominees for several important U.S. posts including trade representative and agriculture secretary have not yet been confirmed.

“As long as our counterparts in Washington don’t define their objectives … today NAFTA regulates trade, so we are not in a hurry to change anything,” Economy Minister Ildefonso Guajardo said at an event on Thursday.

The view of some Mexican officials and business leaders that the U.S. Congress, Supreme Court and some state governors are counterweights to Trump has also been reflected in markets, with the peso rallying in recent days to its strongest since Trump’s election in November.

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