Led by Mexico, major Latin American nations pledged to deepen commercial and economic ties on Tuesday as they sought to counter the risk of a deepening trade war sparked by U.S. President Donald Trump’s “America First” policy.
Leaders of the Pacific Alliance and Mercosur trading blocs met in the Mexican resort city of Puerto Vallarta, seeking to present a united front against potential disruptions stemming from Trump’s threats to slap new tariffs on major markets.
“The aim was to strengthen the links between the two most important trade blocs in Latin America,” said outgoing Mexican President Enrique Pena Nieto, who has spent much of the past two years mired in trade negotiations with Trump.
“Today we’re sending the world a clear signal we’re moving onward with regional integration and free trade,” he added.
Later this week, top Mexican officials will renew talks with the Trump administration in Washington aimed at renegotiating the North American Free Trade Agreement (NAFTA).
Mexico is heavily dependent on the United States as an export market and Trump’s threat to pull out of NAFTA have rattled investors and put pressure on the peso currency.
Pena Nieto said the Pacific Alliance, which comprises Mexico, Chile, Colombia and Peru, agreed with Mercosur – made up of Brazil, Argentina, Uruguay and Paraguay – to explore new ways of cooperation to boost trade in areas of common interest.
The eight countries pledged to undertake a series of steps, including making goods trade easier, helping small and medium-sized firms do business internationally and boosting the knowledge-based economy, Pena Nieto told the summit.
Trump has slapped billions of dollars worth of duties on Chinese goods and is weighing fresh steps against auto imports.
Still, Jesus Seade, the incoming NAFTA negotiator of Mexico’s next president, Andres Manuel Lopez Obrador, said on Tuesday he believed a new NAFTA deal would be reached in the next few months ahead of the talks in Washington.