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Jun 9, 2019

Politics | Bloomberg | Trump Gets Mexico Deal — and Once Again Backs Away From Tariffs

By Steven T. Dennis , Eric Martin , and Nick Wadhams


Photographer: Guillermo Arias/AFP via Getty Images
President Donald Trump pushed Mexico -- and his own party -- to the brink when he threatened massive new tariffs over illegal immigration. And he now has a cross-border deal to show for it.

He also added another chapter in his now-familiar pattern on tariffs: threaten to go big, pull back at the last minute.
The move comes as Trump prepares for a potential high-stakes meeting with his Chinese counterpart Xi Jinping on the sidelines of the Group of 20 meeting in Osaka, Japan, at the end of this month. The abrupt U-turn on Mexico by Trump within a week, in return for what appear to be meaningful yet still relatively modest concessions, is likely to add to confusion in Beijing about Trump’s negotiating goals.
Trump announced late Friday that he wouldn’t impose a sliding scale of tariffs on goods from Mexico -- from 5% to 25% over time -- after that nation agreed to take a tougher stance on immigration, which was his goal all along. Trump on Saturday tweeted that Mexico also will buy “large quantities” of agricultural products, a stipulation that wasn’t included in a joint statement.
Mexico did commit to doing more -- deploy National Guard troops to help curb illegal migration and agree to care for Central Americans seeking asylum in the U.S. indefinitely as their cases wind through the system.
American negotiators had been asking Mexico since the election of Andres Manuel Lopez Obrador in July 2018 to do more to stop the flow of migrants. But it was only in the past week, under the threat of tariffs, that they felt Mexico had begun negotiating seriously, according to a U.S. official.
— Donald J. Trump (@realDonaldTrump) June 8, 2019
“Mexico successfully avoided the catastrophe of tariffs but will pay a heavy price,” said Duncan Wood, director of the Mexico Institute at the Woodrow Wilson International Center for Scholars in Washington. “Potentially tens of thousands of refugee claimants will have to wait in Mexico while their claims are processed. Mexico will have to house, employ, educate and provide health care for them. This is a huge commitment” for the government.
Mexico has been gearing up to address the surge of migrants, with Mexico’s foreign minister, Marcelo Ebrard, saying Thursday the country was prepared to deploy about 6,000 guard troops. And the country already has been hosting asylum seekers while their cases were being processed.
The U.S. originally demanded that Central American migrants apply for asylum in Mexico instead of the U.S. But Mexico beat back that demand. Also, there was no formal language related to increased purchases of U.S. agricultural products, as Trump promised on Twitter, but on Saturday he used Twitter to announce, in call capital letters, Mexico’s buying plans without providing details.
Mexico will try very hard, and if they do that, this will be a very successful agreement for both the United States and Mexico!
— Donald J. Trump (@realDonaldTrump) June 8, 2019
All of this could leave some of those most upset over Trump’s approach, including some Republicans, questioning whether the turmoil of the last week was really worth it.
The whole episode also had a familiar feel: Trump has repeatedly threatened Mexico over immigration only to back off. First, he said he’d immediately close the southern border over migration. Then he abruptly pivoted in April to a new demand: that the Mexican government stop the flow of illegal drugs into the U.S. within a year or face tariffs on automobiles.

Auto Tariff Threat

Separately, Trump has threatened European and Japanese carmakers with tariffs in the name of national security but then said he’d delay any action by 180 days.
This is far from the first time the president has faced criticism over his stance on tariffs. What made this time different was just how alone Trump was in his position. The list of opponents to the idea was long: the U.S. Chamber of Commerce, farm groups, automakers and Senate Majority Leader Mitch McConnell, who took the rare step of saying publicly he disagreed with the president.
Even elsewhere in the Trump administration there was little vocal support for Trump’s Mexico tariffs. Treasury Secretary Steven Mnuchin opposed them, a person familiar with the matter said. So did Trump’s senior adviser and son-in-law, Jared Kushner, the New York Times reported.
Republicans, who have grown adept at talking about areas of disagreement with Trump without sounding like they disagree, didn’t hold back.
“I don’t even want to think about it,” Senator John Cornyn, a Texas Republican, said last week after he was asked about the potential economic harm to his home state.
“I know he’s sometimes, in his frustration, expressed his intention to do certain things, but after calm reflection and consultation with the members of the Congress has decided maybe to pursue a different course,” Cornyn said then. “So that’s what I hope will happen here.”
The wishes of Cornyn -- and many others -- were granted.
Republicans quickly rallied around the president for securing the deal and suggested this could clear the way for Congress to approve the new trade deal between the U.S., Canada and Mexico, known as the USMCA.
“Trump has proven those who doubted him wrong by getting Mexico to step up their efforts to help us secure our southern border,” the No. 2 House Republican, Steve Scalise of Louisiana, said in a statement. “Tonight’s deal made by President Trump also puts us in a better position to make USMCA a reality.”
Yet other Republicans were more nuanced in their reaction. Senator Joni Ernst, an Iowa Republican, said her constituents were “breathing a sigh of relief” and that Mexico “stepped up to help” address the humanitarian crisis. But her statement Friday night didn’t mention Trump.
The deal does alleviate a political challenge for McConnell, given that the 2020 electoral map is far less friendly for the GOP than for Democrats.
Trump’s approval ratings are underwater in a handful of states where Senate Republicans are running for re-election, including Ernst, Cory Gardner in Colorado, Susan Collins in Maine and Thom Tillis in North Carolina.
While Tillis, who faces a primary challenge, was an early backer of Trump’s tariff strategy despite previously calling himself a free trader, others including Cornyn, Ernst and Gardner have been outspoken critics of the president’s trade policy.
Trump had announced the tariff threat in response to a surge in illegal migration to the U.S. through Mexico this year. More than 144,000 people were apprehended after illegally crossing the southern border in May or were refused entry to the U.S. That’s the most in a single month in at least five years; the number has grown every month since January.
Ebrard, said the resolution was fair. “We reached some middle point,” he said.
He added that the two countries will continue discussion for other possible steps in 90 days if needed, an implicit reminder that tensions could flare again if the migrant crisis continues to worsen.
— With assistance by Shannon Pettypiece, Benjamin Bain, and Josh Wingrove
(Updates with background on G-20 in third paragraph.)"

Source: Bloomberg

Politics | Bloomberg | Hong Kong Protest Draws Up to 1 Million in Challenge to China

By Carol Zhong and Fion Li

Demonstrators march during a protest against a proposed extradition law in Hong Kong, China, on Sunday, June 9, 2019.
Demonstrators march during a protest against a proposed extradition law in Hong Kong, China, on Sunday, June 9, 2019.
Photographer: Justin Chin/Bloomberg
Hong Kong’s Beijing-backed government faced new pressure to withdraw legislation easing extraditions to China after as many as 1 million people turned out to oppose the measure.
Hundreds of thousands of white-clad demonstrators, many chanting for Hong Kong Chief Executive Carrie Lam’s resignation, choked 3 kilometers (1.9 miles) of central city boulevards for hours Sunday as they marched to the local government headquarters. As skirmishes broke out after dark, riot police used pepper spray and batons to disperse violent protesters who attacked them, Hong Kong police said on Twitter.
Organizers put the turnout at 1.03 million as of 9:30 p.m., while police estimated 240,000 participants at the rally’s peak.
Either way, the figures suggested one of the largest protests since the former British colony’s return to China more than two decades ago. A crowd of 1 million would require almost one in seven of Hong Kong’s estimated 7.5 million residents to attend.
Late Sunday, the Hong Kong government signaled a determination to press ahead with the bill, which would for the first time allow extraditions to mainland China. But the scale of the opposition raises the stakes for Lam and her backers in Beijing, who are already engaged in a global clash of values with the U.S.
Thousands Protest Hong Kong Law Easing Extraditions to China
Demonstrators march on June 9.
Photographer: Paul Yeung/Bloomberg
A demonstration of about half a million people in 2003 led the city to scrap a controversial national security proposal and contributed to the eventual resignation of then-Chief Executive Tung Chee-hwa. Hong Kong still hasn’t passed that measure.
“For anyone with the right mind in any leadership after seeing this huge, massive turnout this afternoon, they should not just rethink the whole situation,” Claudia Mo, an opposition lawmaker, told Bloomberg during the protest. “They should scrap this very controversial bill and let Hong Kong have some breathing space.”
The extradition bill has been criticized by Western governments and international business organizations as a threat to the “one country, two systems” framework credited with maintaining Hong Kong’s status as a global financial center. It’s one of several moves by President Xi Jinping’s government that have raised concern about Hong Kong’s autonomous structure, which guarantees free speech, capitalist markets and British common law.
Lam is working to pass the measure by the end of the current legislative session in July. with hearings slated to resume Wednesday. Last week, the government scaled back the bill, raising the proposed extradition limit to crimes that carried sentences of seven years in prison, compared with a three-year threshold initially.
In a statement Sunday, the Hong Kong government praised protesters for staging a “generally peaceful and orderly” demonstration, but defended the bill. The government said the legislation was written to ensure that suspects received a fair hearing in court and couldn’t be extradited for political offenses.
“Based on experience in recent weeks that face-to-face explanations by relevant officials have helped to dispel misunderstanding, the government will continue to engage, listen and allay concerns through calm and rational discussion,” the government said.
Thousands Protest Hong Kong Law Easing Extraditions to China
Demonstrators gather at Victoria Park on June 9.
Photographer: Paul Yeung/Bloomberg
Hong Kong Police Commissioner Stephen Lo said early Monday that a number of his officers were injured as some protesters used force, adding that his department will investigate the incidents thoroughly. The clash outside the government office that led to the injuries and damage was “meaningless” because no meetings were taking place inside at the time, he said in a media briefing aired on local TV stations.
On Sunday, demonstrators, who wore white as a symbol of justice, chanted “Oppose extradition to China!” and “Carrie Lam resign” as they marched through the city. Temperatures reached 32-degree Celsius (90 Fahrenheit) at the start of the protest.
“We hope the government can withdraw the bill,” said Ada Kwan, 48, an education company owner, as she pushed her 92-year-old mother in a wheelchair along the route. “This will harm Hong Kong’s democracy, rule of law and autonomy.”
Solidarity protests were also staged in dozens of cities around the world, with about 2,000 people demonstrating in Sydney, the Hong Kong Economic Journal reported. In New York, protesters planned to march from Times Square to the Chinese consulate.
Even before Sunday, the bill had emerged as another tension point between China and the U.S., which grants Hong Kong special trading status based on its legal autonomy from the mainland. The U.S., as well as Canada, the European Union and the U.K., have expressed concern about the legislation.
Thousands to Protest Hong Kong Law Easing Extraditions to China
Demonstrators hold placards featuring Hong Kong Chief Executive Carrie Lam.
Photographer: Paul Yeung/Bloomberg
Read more: China Fugitive Flees Again as Hong Kong Eyes Extradition Law
Lam has said the law is needed to bring fugitives to justice and was spurred by the case of a Hong Kong man who could not be extradited to Taiwan for the murder of his 19-year-old girlfriend. But opponents are concerned that it could open the door to Hong Kong citizens and foreigners being prosecuted by Beijing.
Arnold Li, 36, a marketing officer carrying his toddler during Sunday’s protest, said he was concerned that the legislation would leave the next generation with no legal protection. Meanwhile, Wong Kin Yuen, 76, a Shue Yan University professor who heads its English language and literature department, said this was only the second protest he had attended.
“If this so-called bill passes, it will be more scary,” Wong said. “Every Hong Kong citizen would think it’s a severe problem. What if I say something in my class and could be sent to China the next day?”
— With assistance by Natalie Lung, Magdalene Fung, and Linus Chua
(Add police commissioner’s comment in 12th paragraph.)

Source: Bloomberg