Trump drops Mexico tariff threat after deal on migrants

President TrumpDonald John TrumpDavid Axelrod after Ginsburg cancer treatment: Supreme Court vacancy could 'tear this country apart' EU says it will 'respond in kind' if US slaps tariffs on France Ginsburg again leaves Supreme Court with an uncertain future MORE said Friday evening he would drop plans to impose sweeping tariffs on Mexico after the United States' southern neighbor agreed to take new steps to crack down on illegal migration.

The decision—reached three days before the tariffs were set to take effect—averts a possible showdown with Congress and could soothe jittery financial markets that have been rattled by the proposed duties, which lawmakers and experts warned could damage the U.S. economy.

“I am pleased to inform you that The United States of America has reached a signed agreement with Mexico. The Tariffs scheduled to be implemented by the U.S. on Monday, against Mexico, are hereby indefinitely suspended,” Trump tweeted.

Trump said the Mexican government would “take strong measures to stem the tide of Migration through Mexico, and to our Southern Border.”

Mexican Foreign Minister Marcelo Ebrard confirmed on Twitter that a deal had been reached to avert the tariffs. Secretary of State Mike PompeoMichael (Mike) Richard PompeoBill Maher says he's 'glad' David Koch is dead Trump spurs new wave of economic angst by escalating China fight Trump on North Korean projectile launches: Kim 'likes testing missiles' MORE in a statement Friday thanked Ebrard “for his hard work to negotiate a set of joint obligations that benefit both the United States and Mexico.”

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As part of the deal reached Friday, Mexico has agreed to deploy its national guard throughout the country to help apprehend migrants and fight gangs, boost intelligence sharing with the U.S. and allow the U.S. to deport migrants seeking asylum to Mexico to await adjudication, the State Department said.

Mexico this week froze the assets of more than two dozen entities believed to be involved in human trafficking and deployed 6,000 members of its newly-created national guard to its southeast border in an effort to contain groups of migrants crossing from Guatemala.

The U.S. and Mexico will continue migration talks and if the flow of migrants to the U.S. does not subside within 90 days, “they will take further actions,” according to an outline of the plan released by the State Department.

The decision marks a complete change from late last week, when Trump threatened to impose tariffs on all Mexican goods out of frustration with the rising number of migrants crossing the U.S. southern border.

It is also a victory for the government of Mexican President Andrés Manuel López Obrador, whose representatives spent all week in Washington trying to persuade the Trump administration to drop the tariff plan.

López Obrador tweeted following Trump’s announcement that the delay was achieved “thanks to the support of all Mexicans.” He added he would still hold a rally on Saturday in Tijuana in protest of Trump's tariff threat, which he planned before Friday’s announcement.

Trump appeared to foreshadow a delay of the tariffs, tweeting earlier Friday that there was a "good chance" the U.S. and Mexico could reach an agreement. But he warned that the measures would take effect as planned on Monday if both sides could not reach a deal.

The president had planned to impose 5 percent tariffs on all Mexican imports, which would increase to 25 percent by October if the administration deemed that the Mexican government was not doing enough to curb illegal migration and combat criminal gangs.

Trump’s decision not to go ahead with the plan was applauded by Republican lawmakers, who warned the tariffs could stymie economic growth and derails efforts to ratify a revised trade agreement with Mexico and Canada. Mexico recently became the United States' largest trading partner, and the U.S. imported just under $350 billion in goods from the country last year.

“No tariffs on Mexico. Mexico came through,” Senate Finance Committee Chairman Charles GrassleyCharles (Chuck) Ernest GrassleyThe road not taken: Another FBI failure involving the Clintons surfaces White House denies exploring payroll tax cut to offset worsening economy Schumer joins Pelosi in opposition to post-Brexit trade deal that risks Northern Ireland accord MORE (R-Iowa) tweeted Friday after Trump’s announcement. Grassley was one of several GOP senators who vocally protested Trump’s tariff plan.

Lawmakers had floated a possible measure to block the tariffs, but congressional opponents were unlikely to have the votes necessary to override a potential veto of such a bill. Legal challenges to the tariffs were all but certain.

Mexican Economy Secretary Graciela Márquez Colín said her country was prepared to impose retaliatory tariffs on the U.S., a move that would have intensified the standoff at the same time Trump is waging a trade war with China, the world’s second-largest economy.

Negotiations between U.S. and Mexican officials had accelerated over the past two days, centered on the Trump administration’s demand that Mexico strengthen its border with Guatemala, apprehend more migrants and house asylum seekers.

To emphasize its sense of urgency, the White House pointed to the more than 144,000 migrants who were apprehended or turned away from the southern border in May, a 32 percent jump from April and the highest monthly total in more than a decade.

The Trump administration had previously pushed for Mexico to accept a so-called “safe third country” agreement, under which Central Americans traveling north through its territory would be eligible to apply for asylum in Mexico, but not the United States.

Ebrard on Tuesday told reporters that U.S. officials had not brought up the proposal, which they knew to be a red line for Mexico, but a version of the safe third country agreement eventually became a central part of negotiations.

The deal nonetheless represents a sweeping expansion of the Migrant Protection Protocols (MPP) program, also known as “remain in Mexico,” whereby Central American migrants who claim asylum in the United States are returned to Mexico while their asylum cases are heard in U.S. immigration courts.

The plan could come under scrutiny from immigrant-rights groups and others who say Mexico is not a safe place for asylum seekers to be sheltered. MPP was criticized when the Department of Homeland Security announced it as a pilot program in January because it limits the asylum seekers' access to representation in court and potentially puts them in a precarious position while awaiting a final ruling in Mexico.

Trump first threatened Mexico with tariffs last Thursday, one day after special counsel Robert MuellerRobert (Bob) Swan MuellerMueller report fades from political conversation Trump calls for probe of Obama book deal Democrats express private disappointment with Mueller testimony MORE offered his first public comments on the Russia investigation and on the same day the administration formally triggered the legislation process for the trade pact with Canada and Mexico.

Updated: 10:05 p.m.