U.S. president, Donald Trump, and Mexican president, Manual Obrero announced a trade deal has been reached between the two neighboring countries. The agreement prevents a possible trade war and massive disruption in bi-lateral relations. Whether Congress will approve the trade deal remains uncertain because the agreement allows the president to impose a special tax on products of "Mexican origin" and permits the administration to "... utilize said funds for the design, construction, land acquisition and maintenance of a wall along the southern border".
According to Robert Lighthizer, Chief trade negotiator, products made in Mexico can enter the US without tariffs, but products made in the US of "Mexican origin" will be hit with hefty fees. "This agreement gives the president authority to impose tariffs on products of 'Mexican origin'. Effective January 1, 2020 all food, goods and services of Mexican origin will have a 50% federal surcharge. White House Communication Director, Stephanie Grisham, explained the president consulted with a wide range of experts including his senior adviser, Stephen Miller, and Fox News host Sean Hannity.
The announcement disrupted trading on Wall Street and sent shares of Taco Bell crashing to record lows. In a prepared statement, Taco Bell, CEO, Brian Niccol, indicated his company will contest the tax. "This tax does not apply to us because everyone knows our food is not really food of Mexican origin and if necessary we will prove it in court. We will demand a fair jury consisting of 12 real Mexicans not our fantastic but seriously naïve customers".
The news created mass confusion in the agricultural sector forcing Secretary of Agriculture Sonny Perdue to calm fears among growers. Aides to Secretary Perdue report growers are calling with specific questions, including whether avocados grown in California will be subject to the tax because, after all, they are originally from Mexico. Perdue aides say he will form a products originally from Mexico commission to advice him on the matter.
Trump declared the agreement the greatest ever. "Only a genius, no let me more clear, only this genius, me, Donald J Trump, could have negotiated this agreement. Everyone is talking about it. How great it is. Many people say it is the greatest agreement. I made a promise during the campaign that, if elected, I would build a big, beautiful wall, and Mexico would pay for it. I am keeping my promise. Mexico is paying for it 100%. I am Making America Great Again!"