World on Edge: Calling All Statesmen


Photo: Google

By ANTONIO GARZA, former U.S. ambassador to Mexico

On the night of Thursday, Oct. 19, U.S. President Joe Biden appealed to the nation, and the world, for $100 billion in funding as a show of continued support for both Israel and Ukraine.

This address came almost two weeks after Hamas launched a brutal attack against Israel with Israel subsequently launching a counter-attack against Hamas in Gaza. As the conflict continues, so too, does a mounting humanitarian crisis with Palestinian civilians unable to evacuate. Meanwhile, concerns have emerged over the possibility of an expanding crisis as Iran confirmed its involvement in the Hamas attacks and Iranian-backed Hezbollah intensifies its presence along Israel’s northern border.

Russia’s offensive against Ukraine also continues with Ukrainian President Zelenskyy confirming, for the first time, the use of U.S.-provided long-range missiles this week against Russian targets in occupied Ukrainian territory and Russia’s continuation of lethal airstrikes against Ukrainian cities. This week, Russian President Vladimir Putin also met with Chinese president Xi Jinping while evidence increases of North Korean support for Russia through the alleged delivery of weapons.

While the human costs of these two conflicts continues to rise, we don’t yet know what the economic and geopolitical impact of these volatile situations will be. What is certain is that we are now living in a turbulent moment “that may be the most dangerous time the world has seen in decades.”

In North America, the United States and Mexico have been busy with high-level dialogues on both the economy and security. On Sept. 29, multiple cabinet secretaries from both countries met in Washington for the third High-Level Economic Dialogue meeting since 2021, which focused on increasing manufacturing, improving pharmaceutical regulations and climate change. Notably, the energy and corn conflicts were not discussed.

On Oct. 5, U.S. Secretary of State Antony Blinken traveled to Mexico City for high-level security talks, which focused on curbing fentanyl and undocumented migration to the United States. However, after the meeting, Mexican President Andrés Manuel López Obrador (AMLO) continued to deny that fentanyl is produced in Mexico and critiqued the Biden administration’s decision to reinitiate border wall construction. Overall, the effects of these talks on U.S.-Mexico collaboration are yet to be seen, but López Obrador has committed to a one-on-one with Biden in mid-November at the Asia-Pacific Economic Cooperation (APEC) summit.

In the midst of these meetings, Mexico’s presidential candidates are gearing up to begin their campaigns. Xochitl Gálvez, the Frente Amplio candidate visited California in late September, meeting with Mexican community leaders and farm workers. The in-power National Regeneration Movement (Morena) party candidate Claudia Sheinbaum has pledged to make a similar trip. Former Foreign Relations Secretary Marcelo Ebrard – the Morena candidate runner-up – filed a complaint against Morena’s candidate selection process and, Morena has until Oct. 25 to respond. Ebrard has suggested a third party candidacy, though recent polls show Sheinbaum with a comfortable lead, regardless of his decision.

As the 2024 presidential campaigns also get underway in the United States, an increasingly common talking point of Republican presidential hopefuls is the use of military force in Mexico against fentanyl trafficking and criminal groups. Fentanyl seizures along the U.S. southern border spiked this year, with 9,909 kilograms seized in the first 10 months of fiscal year 2023, compared to 6,396 kilograms in all of fiscal 2022. However, such military interventions are unlikely, and such a rhetorical excess is counterproductive to strengthening the bilateral relationship.

In economic news, Mexico’s economy took a moderate tumble early in the month. On Oct. 5, Mexico’s stock index temporarily fell by roughly 4 percent following the announcement of unexpected price changes on airport tariffs. The stock index quickly rebounded and Mexico’s airport operators have now reached an agreement on the tariff increases. Additionally, inflation rose slightly from 4.44 percent to 4.47 percent in September for the first time since April. That said, BBVA continues to report their real GDP growth estimate at 3.2 percent for 2023, and Mexico’s Central Bank (Banxico) is expected to hold interest rates at 11.25 percent through the end of this year. Finally, on Oct. 11, the López Obrador administration proposed a series of tax breaks to attract more nearshoring, in particular for semiconductors, electric batteries and medical supply operations.

The cycle of trade disputes continues to spark tensions. In September, Texas Governor Greg Abbott announced cargo truck inspections as part of his “Operation Lone Star.” By early October, trucking companies estimated that more 19,000 trucks with roughly $1.9 billion in merchandise were queued as inspections in Texas clogged cargo traffic. López Obrador reported that he would send a diplomatic letter decrying these delays to the Biden administration. The United States and Mexico agreed to intensify monitoring of steel and aluminum imports over concerns that third-country metals are moving through Mexico to avoid U.S. tariffs. Additionally, Mexico continues to double down on curbing U.S. genetically modified corn.

Finally, the Biden administration is taking an ever more enforcement-laden approach to immigration. In September, the United States reported apprehending more than 210,000 migrants at the U.S. southern border, bringing the 12-month total to more than 2 million. In response, the Biden administration announced the resumption of border wall construction along a 20-mile stretch in Texas and a restart of deportations to Venezuela after more than 50,000 Venezuelans irregularly crossed last month. The first of those deportation flights departed on Oct. 18.

ANTONIO GARZA is a U.S. lawyer who served as his country’s ambassador to Mexico between 2002 and 2009. In recognition of his work, in 2009, the Mexican government bestowed on him the Águila Azteca, the highest award granted to foreigners. Prior to his appointment as ambassador, Garza served as Texas’ secretary of State from January 1995 to November 1997 and was also chairman of the Texas Railroad Commission. He is currently a lawyer at White & Case, specializing in cross-border issues. He is also currently a director at both Kansas City Southern and MoneyGram.



Leave a Reply