US presidential candidate Donald Trump (R) delivers a joint press conference with Mexican President Enrique Pena Nieto in Mexico City on Aug. 31, 2016.
Yuri Cortez—AFP/Getty Images
By Ioan Grillo / Toluca, Mexico
January 10, 2017

On a chilly Monday morning in January, auto workers waited outside the expansive Chrysler plant in this industrial hub near the Mexican capital for their shift assembling Dodge Journey SUVs for the American and global markets. They are relatively well paid by Mexican standards; a junior line worker Roberto Corral says he makes U.S. $20 per day, or five times Mexico’s minimum wage.

But as they warmed themselves up by drinking coffee and hot chocolate from a stall, the employees worried about the future of their jobs after President-elect Donald Trump moves into the White House. “I may not make enough to buy a big car myself, but at least I am feeding my family,” says Corral, a 30-year-old father of three. “There aren’t a lot of other options here, so we need these factories.”

Fears about what will follow Trump’s Jan. 20 inauguration are shared by many in Mexico. The President-elect has promised to rewrite the North American Free Trade Agreement, or NAFTA, which allows cars to be imported tariff-free across the Rio Grande. Claiming that the deal robs American workers, Trump has called for levies of 35 percent on vehicles made by U.S. and global companies in Mexico, which would be devastating for Mexico’s auto industry, the biggest in Latin America. Fiat Chrysler CEO Sergio Marchionne said Monday that such a tariff could make the company shutter its Mexico plants like the one here in Toluca. “It’s possible that if economic tariffs are imposed . . . and are sufficiently large, it will make production of anything in Mexico uneconomical and we would have to withdraw,” Marchionne said.

And trade is not the only issue of concern on Trump’s Mexico agenda. Since the beginning of his campaign he has made illegal immigration across the southern border a signature issue. He has promised to deport millions of undocumented migrants from the United States, and his pledge to build a wall along the shared border and force Mexico to pay for it became a regular chant at his pre-election rallies.

To make it worse, Trump is coming to power as Mexico is struggling with a sluggish economy and rising inflation. Since the beginning of the year, there have been widespread protests over a hike in gasoline prices at the pump, with sporadic outbreaks of looting.

Dealing with the Herculean challenge of preserving Mexican jobs and putting the brakes on mass deportations falls to the embattled President Enrique Pena Nieto. He has to do it from a weak position domestically, with a recent poll giving him a 24 percent approval rating amid corruption scandals and persistent violent crime. He drew particular flak for hosting Trump in his presidential palace last August when the billionaire was a candidate. The criticism led to the resignation of his then finance secretary Luis Videgaray, who helped organize the meeting.

But in the latest twist, Pena Nieto reinstated Videgaray in his cabinet last week, this time as foreign minister, making him the point man who will deal with Washington. Videgaray has already built up good relations with the incoming administration; Trump has praised him in tweets, calling him “brilliant,” while he is also widely reported to get on with Trump’s son-in-law and now senior advisor Jared Kushner.

https://twitter.com/realDonaldTrump/status/773948120069615616

While giving few concrete details of his negotiating strategy, Videgaray has said that Mexico will avoid conflict with the United States to pursue what he has described as dignified diplomacy. “There are voices that are already calling for a strategy of conflict, confrontation even insults, others that predict a shameful submission,” he said in a speech on Monday. “Mexico will not opt for either of these false doors. Mexico will act as it has done throughout its diplomatic history, with dignity, with intelligence.”

This will not satisfy many in Mexico, where Trump’s often harsh rhetoric about Mexicans has made him into a widely despised figure (a poll in September found that fewer than 3% of Mexicans had a positive opinion of him). Many believe the government should take the fight to the President-elect, and make it as difficult as possible for him to renegotiate NAFTA or anything else. Senator Miguel Barbosa of the leftist Democratic Revolution Party accused Videgaray of being nothing more than a Trump puppet. “Videgaray has been assigned because he will be willing to do everything Trump suggests,” said Barbosa, who was recently shown in a video introducing a piñata in the form of Trump at a Christmas party.

Advocates of this tougher stance says Mexico could refuse to cooperate with Washington on various issues to gain leverage. For example, it could stop detaining the flow of refugees and migrants who head through their country to cross the U.S. southern border. Or it could decline to arrest drug lords wanted by U.S. courts.

Jorge Mujica, a community organizer of Mexican migrants in Chicago, argues that the Mexican government also needs to take a stronger position on the deportations. There are about 11 million Mexicans who live in the United States, about half of whom do not have papers. Mujica says the Mexican government could make it more difficult to deport people by demanding for example that U.S. authorities prove they are guilty of a crime. “We need to get onto the offensive,” he told TIME. “Mexico has to put forward an agenda, not just react to what Trump does.”

What Trump will do is still a matter of speculation. Already, the President-elect’s team has suggested his “great wall” will be built with U.S. congressional appropriations (though he insisted Mexico would still pay for it later). It’s likely that, for a businessman-turned-politician who sees everything as a transaction, there will be room for negotiations on everything from trade to immigration.

A diplomatic approach to the Trump White House may in the end be more fruitful than trying to fight it, some say. “Whatever our stance is, Mexico is going to end up negotiating with the United States over trade and immigration. It’s inevitable,” says Jorge Chabat, an academic who specializes in U.S.-Mexico relations. “We can’t just refuse to talk about it.”

Finding a middle ground that would make both countries happy, however, might be an impossible task. “Perhaps, the idea of the Mexican government is to lose the least possible,” says Chabat. In factories from Toluca to the Rio Grande, workers hope they won’t be part of those losses.

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