The United States vs Mexico: no wall but a fence!
On Tuesday, February 12, Donald Trump was "very displeased" by the compromise reached by Democrats and Republicans to strengthen the protection of the border with Mexico, and for good reason. Finalised on Monday, February 11, the draft budget of Department of Homeland Security includes only USD 1.3 Bn (EUR 1.1 Bn) instead of the USD 5.7 Bn required for the promised wall by the President of the United States. It will build only 55 miles (88 kilometres) of additional barriers that will add to those already installed in California, Arizona and parts of Texas.
In December 2018, Donald Trump had refused a first project, which planned 110 kilometres of barriers. This decision precipitated a partial shutdown of the federal government that lasted no less than thirty-five days, eroding the president's popularity rating. A year ago, he had already rejected a USD 25 Bn Democratic offer in exchange for the regularization of undocumented immigrants to the United States (US). It seems that Donald Trump prefers to avoid a new shutdown that would further undermine his popularity and plunge the first economy of the world back into a political and economic vacuum. If the US President practices the compromise, it is because he can boast of winning some fights like the trajectory of rate increases by the Federal Reserve. However, a new shutdown in the coming months could cost him a second term…
Julien Moussavi, Head of Economic Research
Source: Beyond Ratings