President Donald Trump announced the 'indefinite' suspension of tariffs planned on goods imported from Mexico after reaching an agreement to tackle illegal immigration along the southern border, and on Sunday claimed that more details were to 'be announced at the appropriate time.'
Trump revealed the agreement late Friday, following his return from a week-long visit to Europe to commemorate the 75th anniversary of the D-Day landings in northern France, and said details would be published shorty by the State Department. Tariffs that had been scheduled to apply to Mexican imports as of Monday would now be suspended, the President said, and on Saturday he thanked Mexican president Andrés Manuel López Obrador, and his foreign minister, "for working so long and hard to get our agreement on immigration completed." He also said over Twitter that Mexico has agreed to start buying "large quantities" of agricultural products from the U.S.
"I am pleased to inform you that The United States of America has reached a signed agreement with Mexico," Trump said on his verified Twitter account. "The Tariffs scheduled to be implemented by the U.S. on Monday, against Mexico, are hereby indefinitely suspended," he said.
Trump had threatened to apply a 5% levy on goods imported from Mexico next week, and said that charge would increase by 5% each month until it reached a maximum of 25% by the end of October, if Mexican officials weren't able to address the rise if illegal migration across the southern border, particularly in states such as Texas and Arizona.
"Given the dramatic increase in migrants moving from Central America through Mexico to the United States, both countries recognize the vital importance of rapidly resolving the humanitarian emergency and security situation," the two countries said in a joint statement published on the State Department website. "The Governments of the United States and Mexico will work together to immediately implement a durable solution."
Mexican Foreign Minister Marcelo Ebrard said the agreement strikes a "fair balance" balance between the two sides following three days of talks in Washington, but stressed that his government had rejected a White House demand to have Mexico deemed a "safe third country" for the return of central American deportees from the United States.
The Mexican agreement could now raise the prospect of a near-term solution to the ongoing trade dispute between the U.S. and China, as Treasury Secretary Steven Mnuchin plans a meeting with People's Bank of China Governor Yi Gang on the sidelines of the G20 meeting of finance ministers and central bankers in Fukuoka, Japan, this weekend.
"This is not a negotiating meeting," Mnuchin told reporters ahead of the meeting on the Japanese island of Kyushu, but nonetheless said the two sides were "90%" on their way to an "historic agreement."
"If we can get the right agreement, that's great," Mnuchin said. "If we can't get the right agreement, we will proceed with tariffs."
The U.S. raised tariffs on $200 billion worth of China made goods last month, and said it would apply a similar levy to a fresh basket of $300 billion in imports later this summer if China isn't prepared to tackle key issues such as intellectual property theft and market access for American companies doing business in the world's second-largest economy.
Investor focus will now turn to the full G20 Summit in Osaka later this month, where President Trump and his opposite number, Xi Jinping, are expected to meet and hammer out the final outstanding issues that have prevented a trade agreement between the two nations for the past seven months.