farquharj@xtra.co.nz

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Mexico Reacts To 'Trump Effect' After Ford Scraps Plant

The Ford Motor Company's decision not to open an auto plant in Mexico — in a swift reaction to Donald Trump's offhand threat to slap tariffs on all imported vehicles — is another sign that when the president-elect tweets, people pay attention. It's also a reminder that Trump doesn't need to build a wall to hit Mexicans where it hurts.

The announcement Tuesday that Ford would scrap the $1.6 billion factory in favor of investing in the state of Michigan is the clearest indication that Trump's tough talk about curbing free trade in the NAFTA zone to "save" U.S. jobs can turn to action. Mexicans, for their part, are recognizing that the stakes of the coming U.S. protectionist approach are particularly high for them. Besides pushing down the peso, the pending Trump presidency may have longer-term, dismal effects on the country's jobs and investment panorama.

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