Donald and Melania Trump
The implementation of President Trump’s wall on the Mexican border could alter the United States’ trade relationship with Mexico. Fritz Roka, an associate professor at the University of Florida stationed at the Southwest Florida Research and Education Center, spoke with AgNet Media about the implications of the wall and its possible effect on Mexican trade.
According to the U.S. Department of Agriculture’s Economic Research Service, Mexico is one of the largest suppliers of U.S. agricultural products. Although President Trump’s wall is only being built to resist illegal immigration, it could have negative effects on agricultural trade.
Roka believes the wall is more of a symbol than a real limitation on illegal immigration. However, the symbol the wall represents may not be a positive one. “If they (the Mexican government and business people) perceive that to be a negative thing, in general, I think there could be less inclination to trade with the United States,” Roka said.
Roka says the question of the effect of the wall is complicated. Right now there is a lot of uncertainty about the wall and future trade alterations under Trump. He added that businesses generally do not like uncertainty. If trade regulations are made, businesses will accept them if they bring certainty. ” Once the regulations are in place, such as a trade agreement, they can adapt and move forward,” Roka said.
Roka also briefly discussed the North American Free Trade Agreement (NAFTA). NAFTA has been in effect since 1994, after it replaced the U.S.-Canada Trade Agreement to include free trade with Mexico. He says that when the government starts to question the future of a principal trade agreement, businesses tend to become nervous about the future.
Until the Trump administration makes definitive trade regulations with Mexico, uncertainty will continue to plague the American agriculture industry. “So long as there’s this period of uncertainty about what the future’s going to look like, that’s going to hurt trade on both sides — us moving product to Mexico and Mexico moving product here,” Roka said.