MEXICO CITY — Donald Trump’s proposal to barricade the U.S.-Mexico border could cost textile and apparel firms more than $2 billion in cross-trade losses – if it is ever built, said Jose Manuel Martinez, general manager of top Mexican apparel lobby Canaive.
“His proposal is out of proportion,” Martinez told WWD. “The U.S. does not have a deficit with Mexico in apparel. We are its number-one customer for cotton and fabric. American companies are here spinning yarn and sewing garments, others making jerseys and others shipping fabric to Central America to return as pieces to be manufactured in Mexico.
“Trump doesn’t understand how integrated our economies are. Our feedstock imports generate U.S. jobs; the apparel we export creates U.S. retail jobs.”
Added Martinez: “If Trump proceeds with this wall, the U.S. will suffer. It will have a geopolitical problem.”
His comments came as anti-Trump sentiment reached a boiling point this week when the Republican presidential front-runner stopped short of declaring war on Mexico if it refuses to pay for the $10 billion barricade. The proposal has created an outcry in Mexico, with President Enrique Pena Nieto equating Trump to Hitler and naming “the gringo non grata” from entering the nation.
Nate Herman, vice president of international trade at the American Apparel and Footwear Association, said the body has yet to assess the potential impact of the proposed 2,000-mile fence, but noted it’s “cause for concern.”
“This would have a negative impact,” said a U.S. apparel executive, who requested anonymity. “If you put up a wall, trade will be squeezed into two goal posts.”
The U.S. exported $6.5 billion of apparel and textiles to Mexico last year, of which $4 billion was fabric and $1.2 billion apparel parts. There was $665 million of textiles and yarn, according to AAFA data. In turn, Mexico sent $4.5 billion to the U.S., about $3.5 billion of which was apparel and $1 billion textiles, according to Canaive executives.
Martinez predicted that the $11 billion in trade flows could fall 20 percent, or $2.2 billion, in the wall’s first year.
He said Mexico is working to secure the U.S. border while expediting trade.
As part of a new Cargo Pre-Inspection Program, it allows U.S. Customs and Border Patrol agents to inspect cargoes on Mexican soil. “We reformed our constitution to allow this,” Martinez said. “Now we have a joint dispatch system that significantly cuts delays and addresses any security issues.”