MEXICO CITY: Mexico is increasingly confident that US President Donald Trump will not be able to impose harsh barriers on imports anytime soon, and officials signalled they may hit their northern neighbour’s most trade-sensitive districts in case he does.

Trump wants to renegotiate the North American Free Trade Agreement with Mexico and Canada, but talks cannot begin until he triggers a 90-day notice period by informing Congress. Nominees for several important US posts including trade representative and agriculture secretary have not yet been confirmed.

“As long as our counterparts in Washington don’t define their objectives … today NAFTA regulates trade, so we are not in a hurry to change anything,” Economy Minister Ildefonso Guajardo said at an event on Thursday.

The view of some Mexican officials and business leaders that the US Congress, Supreme Court and some state governors are counterweights to Trump has also been reflected in markets, with the peso rallying in recent days to its strongest since Trump’s election in November.

“Time has in some way meant that the pumpkins have fallen into place in our favour,” Guajardo later told local radio, using an expression in Spanish.

In an interview with Reuters on Thursday, Trump said he supported some form of border tax to boost jobs. But such a tax would meet resistance in Congress from fiscally conservative Republicans and Democrats.

Moises Kalach, from the business group CCE and one of the lead private-sector NAFTA negotiators with the Mexican government, told Reuters that such hurdles could temper Trump’s plans.

“They balance it out so that this will be done with an institutional methodology, and not through social media,” he said. “At home, we’re ready, we’re ready for what’s coming.”

Foreign Minister Luis Videgaray said if the United States taxed Mexican imports, Mexico would “hit them where it hurts,” two Mexican newspapers reported, based on recordings they obtained of a closed meeting with lawmakers on Wednesday.

Videgaray warned of tariffs targeting congressional districts and states most reliant on exports to Mexico, giving as examples Iowa, Texas and Wisconsin.

Mexico’s Foreign Ministry did not respond to a request for comment about the reports.

Videgaray referred to a strategy Mexico used in 2009, slapping locally focused tariffs on 90 US products in a dispute over trucks using US roads. Mexico’s trucks were eventually allowed back and the tariffs lifted.

Comments by US Treasury Secretary Steve Mnuchin to Fox Business Network that the NAFTA renegotiation could be win-win and would not change anything soon calmed nerves in Mexico on Thursday, where Videgaray met with US Secretary of State Rex Tillerson and Homeland Security Secretary John Kelly.

WASHINGTON — The foreign ministers of Mexico and Canada presented a unified front ahead of potential trade talks with Donald Trump’s administration, stressing the North American Free Trade Agreement has benefited all three countries.

Mexico’s Luis Videgaray and Canada’s Chrystia Freeland said NAFTA should be renegotiated with all three nations seated at the table, rather than in bilateral discussions.

“We very much recognize that NAFTA is a three-country agreement,’’ Freeland said Tuesday at a panel discussion with Videgaray in Toronto ahead of private trade talks. ‘‘We really value our relationship with Mexico.’’

Their talks come after Trump said trade with Canada only needed a ‘‘tweak’’ as opposed to a more thorough re-set with Mexico, a comment he made after Canadian Prime Minister Justin Trudeau’s visit to the White House last week.

Ford Motor Co. (NYSE: F) is moving ahead with plans to build two auto parts plants in Mexico despite getting previous grief from U.S. President Donald Trump over another production plant, according to reports by AFP and other outlets.

Ford’s stock was up 0.3 percent today closing at $12.58 per share, according Yahoo Finance. Ford’s stock is up 3.7 percent so far this year, according to Google Finance.

Mexico is Arizona’s top trading partner and the state has an auto supply chain sector. Arizona is also a growing hub for driverless car research including from General Motors (NYSE: GM), Intel Corp. (Nasdaq: INTC) and Google parent Alphabet Inc. (Nasdaq: GOOGL).

“The plants, in the central state of Guanajuato and the northern city of Chihuahua, will make engines and transmissions,” according to the AFP report.

Ford ditched plans for a $1.6 billion small-car production plant after getting grief from Trump.

Trump is pushing for more manufacturing in the U.S. and has talked about a 20 percent tax on imports. He’s met with the CEOs of automakers, tech firms and other businesses at the White House.

Trump visited a Boeing (NYSE: BA) plant in South Carolina Friday promising more manufacturing jobs and tax cuts.

GM was up to $37.22 per share Friday a 0.51 percent gain. General Motors is up 6.8 percent this year, according to Google Finance.

Elon Musk’s Tesla Motors (Nasdaq: TSLA) was up 1.22 percent ending the week at $272.23, according to Yahoo Finance.

All Nippon Airways was to launch direct flights between Narita Airport and Mexico City on Wednesday, the first such flights to Mexico operated by a major Japanese airline company. The move is expected to strengthen Narita’s position as an international hub connecting Asia and the Western Hemisphere.

The company plans to operate daily direct flights to and from Mexico City using its fleet of Boeing 787-8 aircraft. Due to Mexico City’s altitude of more than 2,000 meters above sea level, ANA has refitted aircraft for use on the route with enhanced Rolls-Royce engines.

According to the timetable, flights departing Narita at 4:40 p.m. will arrive at Mexico City at 1:55 p.m. the same day. Returning flights departing Mexico City at 1:00 a.m. arrive back at Narita at 6:35 a.m. the next day. The about 14½-hour flights on the return trip will be ANA’s longest.

The company has established a system in which travelers to Mexico can purchase not only ANA tickets but also those of connecting flights on Mexico’s domestic carriers Aeromexico and Interjet.

Behind ANA’s strategy is the fact that Mexico has become a major destination for Japanese direct investment, with the total amount having increased by 170 percent in the five years from 2010. Major automakers such as Nissan Motor Co. are already operating in Mexico.

ANA began to consider opening a direct route to Mexico approximately three years ago in a bid to respond to growing demand for business trips to the country. As of early February, the first flight from Narita was fully booked, and about 70 percent of the seats on February flights had already been sold.

The reservation rate — higher than for flights to U.S. destinations — matched ANA’s expectations. For March flights, more than 40 percent of seats had been reserved.

ANA has included in its mid-term management plan toward fiscal 2020 a plan to expand new flight routes to destinations in Central and South America as well as cities in Asia, two regions known in the company as “blank areas.”

ANA went ahead with its original plan to open the route despite U.S. President Donald Trump’s stated intention to renegotiate the North American Free Trade Agreement, which has cast a chill over the business environment in Mexico, including Japanese companies operating there.

ANA President and CEO Osamu Shinobe told The Japan News: “Mexico is an important production base for Japanese companies. We expect demand for air travel [to Mexico] will stably expand.”

The new flights are poised to help Narita become a major hub on the western Pacific Rim.

During the past Chinese Lunar New Year holiday season, groups of travelers from Singapore were seen rushing to make their connections to international flights at Narita.

In recent years, competition to become a hub for Asia has intensified among international airports in Asia. According to Narita International Airport Corp. (NAA), the airport had 313 flights a week bound for destinations in North America, while Incheon International in South Korea had 188 and Shanghai’s Pudong International had 158 as of November 2016. However, Narita’s edge in the number of flights is offset by its comparatively small total number of international passengers.

According to the Airports Council International’s rankings, 30.54 million passengers used Narita for international flights in 2015, while 48.72 million passed through Incheon for the same purpose. Narita ranked 17th and Incheon was 8th on the list of airports with the most international passengers.

More Asian airline companies could launch direct flights from their countries to North America, thanks to improvements in the fuel economy of aircraft. Given such a trend, NAA opened last October a directly operated passenger lounge at Terminal 1 for international travelers to make transits easier.

Narita’s plan to construct a new third runway is another effort to further internationalize.

“Narita remains in a dominant position in Asia when you look at connectivity with North American destinations. We will continue to broaden our network by making transit times shorter, so that our airport is even more convenient to use,” NAA President and CEO Makoto Natsume told The Japan News.

The scene in the Oval Office was remarkable: the foreign minister of Mexico — the very country that Donald Trump had turned into a campaign-trail ­piñata — huddled with now-President Trump and his son-in-law, Jared Kushner.

The men were debating what Trump would say in a speech later that day as he ordered construction of a wall at the U.S.-Mexico border. The Mexican diplomat, Luis Videgaray, and Kushner, a White House senior adviser, had concluded that the remarks as drafted would upend the two countries’ fragile relationship, so together they urged Trump to soften his language about Mexico.

The trio arrived at a compromise, according to a half-dozen U.S. and Mexican officials who detailed the encounter. Trump, understanding that Mexicans would hang on his every word, agreed to state that a strong Mexico was in the best interests of the United States. In Mexico City that afternoon, Jan. 25, officials welcomed Trump’s remarks as the most encouraging statement he had given to date about Mexico — and they celebrated Kushner as a moderating influence.

Relations ruptured anew only hours later, however, after a war of words between Trump and Mexican President Enrique Peña Nieto — punctuated by an angry Twitter missive from Trump the next morning while Videgaray was back at the White House.

Trump promised a foreign policy based on unpredictability, and by that measure, he is delivering. The messy episode involving a neighbor and longtime ally encapsulates his administration’s emerging foreign policy, one that mingles the president’s public bellicosity with Kushner’s behind-the-scenes diplomacy.

Although Kushner, 36, has no traditional foreign policy experience, he has become the primary point of contact for presidents, ministers and ambassadors from more than two dozen countries, helping lay the groundwork for agreements, according to U.S. and foreign officials with knowledge of the contacts. He has had extensive talks with many of these diplomats, including in Europe, the Middle East and the Asia-Pacific region, the officials said.

Kushner’s back-channel communications with Mexico — the full extent of which has not been previously reported — reveal him to be almost a shadow secretary of state, operating outside the boundaries of the State Department or the National Security Council.

Videgaray had come to the White House on Jan. 25 for a full day of private meetings, but it was Kushner who gave him a heads-up that Trump would deliver a speech that afternoon at the Department of Homeland Security where he would sign an executive order on his signature border wall.

And it was Kushner who led Videgaray into the Oval Office for an unscheduled audience with the president, where together they made their case to Trump for a more measured discussion of Mexico.

The president agreed.

“We also understand that a strong and healthy economy in Mexico is very good for the United States — very, very good,” Trump said in his speech. “I truly believe we can enhance the relation between our two nations to a degree not seen before, certainly in a very, very long time.”

But Videgaray and Kushner’s victory was short-lived.

So strong were the anti-Trump political winds at home that Peña Nieto felt compelled to go on television that night to declare that Mexico would never pay for the border wall.

This angered Trump, who tweeted at 8:55 Eastern time the next morning that he and Peña Nieto should cancel their upcoming summit if Mexico refused to pay for the wall. Peña Nieto called off the visit and in a brief phone call instructed Videgaray — back at the White House for another round of meetings — to leave and come home.

The mission was aborted, according to the officials’ accounts, and Kushner seethed with frustration at the outcome. Kushner declined to be interviewed.

Some of the leaders who have dealt with Kushner said they were initially skeptical but found him to be a good listener and courteous intermediary who quickly intuits the core of their issues and can facilitate meetings throughout the administration.

One of his top ambitions is to help broker peace in the Middle East — something with which the president has publicly tasked him — and Kushner, an Orthodox Jew, quietly has taken an active role in helping select ambassadors to that region.

“Everyone is trying to get to know Jared Kushner,” said the ambassador from one U.S. ally, who spoke on the condition of anonymity to be candid. Many ambassadors were loath to put even their positive thoughts about Kushner on the record for fear of jeopardizing what has become their most important contact in Trump’s Washington.

Some U.S. companies are going ahead with plans to invest in Mexico despite President Donald Trump’s vows to talk businesses into keeping their assembly lines in the United States, the Wall Street Journal reported.

The businesses include Rexnord Corp., whose factory in Indianapolis, Ind., was singled out by Trump last December for firing workers amid plans to move their jobs to Mexico, the Journal said.

“It just puzzles me to think that they have to [reduce costs] by dumping us out,” Gary Canter, a machinist at the Rexnord factory, told the Journal. “It’s very un-American.”

“We gave this man a chance because it wasn’t a typical politician that’s done nothing for us,” Canter said.

According to the Journal, others are:

Peoria, Ill.-based Caterpillar, which is moving ahead with a restructuring that includes shifting jobs from a Joliet, Ill., factory to Monterrey, Mexico.
Charlotte, N.C.-based Nucor, which is going ahead with Japan’s JFE Steel to build a new plant in Mexico.
Manitowoc Foodservice Inc, which has laid off about 80 workers at a factory near Sellersburg, Ind., as part of its already announced plans to shift much of the production to facilities in Mexico.
Ford Motor Co., which though it’s scrapping plans to build a new factory in Mexico and instead create 700 new U.S. job, announced last month it would still shift production of its Focus small car from Michigan to an existing Mexican facility.
General Motors Co., which is moving more production to Mexico even as it’s continuing with pre-election plans to add more jobs in the United States.

U.S. food producers and shippers are trying to speed up exports to Mexico and line up alternative markets as concerns rise that this lucrative business could be at risk if clashes over trade and immigration between the Trump administration and Mexico City escalate.

Diplomatic relations have soured fast this month, as the new U.S. administration floated a 20 percent tax on Mexican imports and a meeting between the presidents of the two countries was canceled. U.S. President Donald Trump has also pledged to renegotiate the North American Free Trade Agreement (NAFTA) trade deal with Mexico and Canada.

Mexico is one of the top three markets for U.S. farm production.

Some U.S. producers of corn, soybean meal and distillers dried grains (DDGs), an ethanol byproduct, are trying to accelerate sales to Mexico because they are uncertain about the risk for new tariffs to disrupt trade, said Rafe Garcia, general manager for U.S. operations at shipper Primos & Cousins USA.

“They don’t know what will happen in the next month or the next week,” Garcia said about producers. “They are trying to move everything as fast as they can.”

The company, which ships U.S. livestock feed to Mexico and imports Mexican products like molasses, has already talked with U.S. producers about selling into other countries, such as Nicaragua, to reduce their dependence on Mexico, Garcia said.

Exports are critical for U.S. farmers as a global slump in prices for agricultural products has pushed incomes to their lowest in years

Last week, more than 130 trade associations and food companies, including Cargill Inc [CARG.UL] and Tyson Foods Inc (TSN.N), touted the benefits of NAFTA in a letter to Trump on trade.

Food producers say the agreement has quadrupled U.S. agricultural exports in the region during the past two decades.

Mexico is expected to import about 4 percent of the U.S. corn crop in 2016/17, according to the U.S. Department of Agriculture (USDA). It buys 7.8 percent of U.S. pork production, the U.S. Meat Export Federation said.

The agriculture community, which strongly supported Trump during the presidential election, has already voiced its concern that he has withdrawn the United States from the Trans-Pacific Partnership (TPP) trade pact. They are worried Mexico could use tariffs to strike back against Trump’s plans to rework NAFTA and build a wall to keep out illegal immigrants.

Malcolm DeKryger, president of Indiana pork producer Belstra Milling, said he was worried Mexico would impose tariffs on U.S. ham, which could cause Mexican buyers to turn to Brazil or Europe.

“They’re going to retaliate,” he said about Mexico. “The place they can hit back as fast as they can to try to affect our pocket book is the food.”

Mexico could target sanctions on farm products, in particular, in an attempt to punish rural communities that supported Trump in the presidential election, said Katherine Baylis, associate professor of agricultural and consumer economics at the University of Illinois.

“Look at where past trade retaliations have happened: It is amazingly pointed and usually pointed at crucial products from swing states which quite often turn out to be agricultural,” Baylis said.

Prominent Mexican politicians, including former President Felipe Calderon, have said the nation should consider ending purchases of U.S. corn if Trump applies new taxes on Mexican exports.

U.S. company Ingredion Inc (INGR.N), which produces high fructose corn syrup and other corn products, said its “geographic diversity balances country-specific headwinds.”

In 2009 and 2010, Mexico put tariffs on 99 American exports in retaliation when Washington blocked Mexican trucks from using U.S. highways. The strategy targeted products seen as important to specific U.S. regions, including Christmas trees, apples and frozen sweet corn, to maximize political pressure.

The dispute cost U.S. businesses over $2 billion and cut U.S. exports to Mexico of affected agricultural commodities by 27 percent.

General Motors is cutting 625 jobs at its assembly plant near London, Ont., as it shifts some production to Mexico.

Mike Van Boekel, spokesman for Unifor Local 88, says the layoffs will take effect in July at the CAMI Assembly plant in Ingersoll, Ont.

That plant was excluded from negotiations last fall between Unifor and the Big Three automakers, including GM. The CAMI plant is scheduled to have its own negotiations with its roughly 3,000 workers later this year.

“This decision reeks of corporate greed,” Unifor’s national president Jerry Dias said. “It is not based on sales, it is an another example of how good jobs are being shifted out of Canada for cheaper labour in Mexico, and Unifor will not let it happen without a fight.”

Earlier this month, GM announced it would move Terrain production to Mexico from the Ingersoll plant, but boosting production of another vehicle, the Chevrolet Equinox, with the newfound capacity at the CAMI plant.

“It was previously announced with employees that the next generation GMC Terrain will be produced outside of CAMI,” GM spokeswoman Jennifer Wright said. “We have confirmed the production location to be Mexico.”

In an interview with CBC News, Unifor Local 88 president Dan Borthwick said when the Terrain news was announced, it was the union’s understanding that no jobs would be lost in Canada as a result.

“Our understanding [was] that we had sufficient production in the future and we would not be incurring any layoffs,” he said. “Within a week or two weeks we get this horrible news this morning that 600 members would be laid off.”

GM disputes that version of events, saying in a statement it “provided Unifor advanced notification of labour impacts related to product changeovers and transition at its CAMI facility.”

“We continue to work with our Unifor partners to manage through the adjustment with all measures available to us within the collective agreement,” Wright said, adding that the site is expected to remain a three-shift facility “depending on demand for this new generation Equinox.”

Asked for comment, Navdeep Bains, Canada’s minister of innovation, science and economic development, said the government is “concerned about the impact of job losses on workers and their families and our thoughts go out to those affected.”

“We remain optimistic about the strength and future of Canada’s automotive industry,” Bains said.

Speaking to reporters after a caucus meeting in Quebec City, interim Conservative leader Rona Ambrose said the incident speaks to the need for more government action.

“We don’t lose jobs south of the border or to Mexico because we don’t have free enough trade,” she said, “We lose them because we’re uncompetitive.”

“Whether it’s labour costs, or energy costs — people believe that they can’t do business and there isn’t an environment to do business,” Ambrose said.

The move comes against the backdrop of a new administration in the U.S. that has threatened to tear up NAFTA and slap a punitive tariff on companies that make cars outside the U.S. in places like Mexico, which makes about two million cars a year bound for the U.S. market.

The non-partisan think-tank Center for Automotive Research recently estimated that tearing up NAFTA would directly cost 31,000 U.S. auto manufacturing jobs.

How could Mexico inflict the most damage on the United States?

In normal times this question would not be top of mind for Mexican policy makers. Mexican governments over the last quarter-century have consistently pushed back against the nation’s historical resentment toward the United States, hoping to build a more cooperative relationship with its overbearing northern neighbor.

But these aren’t normal times. As President Trump prepares the opening gambit in his project to either renegotiate the North American Free Trade Agreement or pull out, Mexico’s most important strategic goal is narrowing to one word: deterrence.

It must convince Mr. Trump that if he blows up the trade agreement on which Mexico has staked its hopes of development, by weaving its economy ever more closely into that of the United States, the United States will suffer, too.

The critical question is whether Mexico’s threat will be convincing.

Mexico’s main challenge as it confronts a hostile Trump administration is the enormous asymmetry of the bilateral relationship. Ending Nafta would hurt the United States: Six million American jobs depend on exports to Mexico, according to Mexican officials. But to Mexico, it could prove devastating.

Mexico has relied on the pact to draw foreign capital into the country, not only ensuring multinational companies stable access to the largest consumer market in the world but also guaranteeing that their investment is safe, noted Luis Rubio, who heads the Center of Research for Development in Mexico City.

The makings of a Mexican strategy for defending its interests started coming into focus on Monday, when President Enrique Peña Nieto declared that negotiations for a future relationship with the United States would not be limited to trade.

“We will bring to the table all themes,” he said in a speech. “Trade, yes, but also migration and the themes of security, including border security, terrorist threats and the traffic of illegal drugs, weapons and cash.”

His hope is that by introducing broader uncertainty about the bilateral relationship — Will Mexico still cooperate in the fight against drug trafficking? Will it stop foreign terrorists from using Mexico as a way station into the United States? — Mexico can raise the stakes enough for Mr. Trump to reconsider his “America first” approach to commerce.

“Mexico has a lot of chips to play,” said Jorge Castañeda, a former foreign secretary who has staked out a combative approach.

Let Mr. Trump pull the United States out of Nafta, he argues. Instead of stopping Central American migrants at its southern border, Mexico should let them through on their way to the United States. “And let’s see if his wall keeps the terrorists out, because we won’t,” Mr. Castañeda added.

The view from Mexico City is not uniformly bleak. Some analysts believe there is a potential for a situation in which a new Nafta benefits all. “I have always believed one should never let a good crisis go to waste,” said Arturo Sarukhán, a former Mexican ambassador to the United States. “There is an opportunity that we could end up modernizing and improving Nafta.”

The view that there is a potential silver lining to Mr. Trump’s hostility toward Nafta is also popular in some Washington circles. The quarter-century-old agreement is due for some modernization anyway, if only to deal with things like data protection, online crime and e-commerce — which were not around in the early 1990s. Nafta’s weak provisions on labor and environmental standards could also be improved.

Many aspects of Nafta could be upgraded, trade experts say. It could do with new rules to open up government projects to bidders from all three Nafta partners. Allowing long-haul trucking companies from Mexico and the United States into each other’s markets could make trade between the two more efficient. What’s more, the Mexican-American border could benefit from more infrastructure investments to integrate energy networks, reduce clogged lines at border crossings and the like.

Now that Mr. Trump has formally nixed the Trans-Pacific Partnership, which would have tied North America and nine other nations from the Pacific Rim into one large trade bloc, some of its provisions could be drafted into a new North American deal.

Gary Hufbauer of the pro-trade Peterson Institute for International Economics in Washington suggests that the name “Nafta” be retired — it has a bad reputation. But a lot of its substance could remain, perhaps in the form of separate bilateral agreements with Canada and Mexico.

“Trump wants some easy victories,” Mr. Hufbauer pointed out. If he can score political points using his Twitter feed to persuade a few companies to keep jobs in the United States, why risk hurting the American economy by abandoning the North American trade deal? “Maybe that’s the reconciliation,” Mr. Hufbauer said.

Still, it’s hard to reconcile the proposal for an improved, more effective trading pact in North America with Mr. Trump’s frequent portrayal of trade as a zero-sum game that inevitably shortchanges the United States.

In Mr. Trump’s eyes, improving Nafta seems to mean eliminating Mexico’s trade surplus with the United States and limiting investment by American multinationals in Mexico. But one can’t quickly eliminate a $60 billion trade surplus with a new Nafta — not unless it has some incredibly draconian limits on imports or local content requirements that could be as damaging to Mexico as abandoning the pact altogether.

Many Mexican officials fear that it is precisely this kind of draconian change that Mr. Trump has in mind. It would be politically profitable, at least in the short term. And it would signal toughness to China — a more formidable rival that is next on Mr. Trump’s list. If Canada stays out of the fray, cutting a separate deal with the United States to replace Nafta, Mexico would be left alone in an existential fight for its future.

In this case, Mexico may have no choice but to raise the stakes and hope to arrive at the negotiating table with a threat at least as credible as Mr. Trump’s promise to pull out of the deal.

Mr. Trump’s negotiating position does have some soft spots. For one, said Mickey Kantor, the American trade negotiator who concluded the Nafta negotiations during the Clinton administration, “he is under pressure to deliver a deal.”

If Mexico stands its ground and even allows Nafta to dissolve, it would send its own signal to China: Resistance is not futile. And Mr. Trump’s threat to raise tariffs against Mexico to 35 percent could easily be challenged under the rules of the World Trade Organization.

This is, of course, a hugely risky strategy for Mexico. When Mr. Trump entered the presidential race in June 2015, a dollar was worth about 15 pesos. Now it’s worth about 22. A frontal confrontation with the United States might send it to 40, Mexican officials fear, fueling capital flight.

And yet that may be Mexico’s strongest card.

As noted by C. Fred Bergsten, director emeritus of the Peterson Institute, an irony of Mr. Trump’s approach to Mexico is that by weakening the peso so much, he is going to increase the bilateral trade deficit, increase Mexico’s competitiveness and make it more attractive for American companies to invest there. “That is going to swamp anything he achieves with his company-by-company efforts,” he added.

That’s if Mexico manages to hold on. The more ominous situation is one in which the United States pushes too hard and Mexico — its economy, its unpopular government, its public order and political stability — buckles. The United States has enjoyed a peaceful southern border for 100 years, since Pancho Villa made his marauding raids into the Southwest during the Mexican Revolution. “That is worth pure gold in this and any other world,” Mr. Castañeda said. “Mexico’s best argument is ‘Don’t mess with that.’”

MEXICO CITY (Reuters) – Mexico must be ready to respond immediately with its own tax measures if the incoming administration of President-elect Donald Trump imposes a border tax, the economy minister said on Friday, warning such protectionism may trigger a global recession.

Trump, who takes office on Jan. 20, has promised a “major border tax” on companies that shift jobs outside the United States, and such a measure could hobble Mexico’s exports to its top trading partner.

“It is clear we need to be prepared to immediately neutralize the impact of such a measure,” Economy Minister Ildefonso Guajardo said in an interview on Mexican television.

“And it is very clear how – take a fiscal action that clearly neutralizes it,” he said.

Trump has repeatedly attacked Mexico over trade, jobs and immigration since he first launched his run for the White House in 2015, driving the peso currency to historic lows and unnerving investors, especially in the auto sector.

Guajardo said Trump’s proposed tax “was a problem for the entire world” and that it “would have a wave of impacts that could take us into a global recession.”

Nonetheless, the minister said he expected foreign direct investment in Mexico this year to total around $25 billion, with investment in the energy and telecommunications sectors expected to more than make up for the loss of a planned $1.6 billion Ford Motor Co. factory that the company said this month it is cancelling. Trump had strongly criticized the plan, but Ford said its decision was not the result of pressure from Trump.

Guajardo also praised the government of Japan and Toyota Motor Corp for their “reasonable” response to Trump’s threat to impose a significant border tax if the company does not stop making its Corolla model in Mexico for the U.S. market. Toyota said last week the automaker has no immediate plans to curb production in Mexico.

“Toyota has 10 plants in the United States… and employs more than 130,000 Americans. If I were Mr. Trump, I’d treat them with more respect,” Guajardo said.

He added that he expects total foreign direct investment during the six-year term of President Enrique Pena Nieto, which ends in late 2018, to average $30 billion annually.

Guajardo has previously warned that U.S. corporate tax cuts proposed by Trump, as well as the border tax, could undermine foreign investment in Latin America’s No. 2 economy.

Mexico slapped a tax on U.S. high fructose corn syrup in the early 2000s after the United States refused to allow free trade in Mexican sugar.