Yellen to visit Mexico for talks on boosting trade, fighting fentanyl trafficking

Treasury Secretary Janet Yellen is heading to Mexico on Tuesday, with a double duty to strengthen cooperation against drug trafficking and to expand the bilateral trade relationship.

Yellen is scheduled to meet with Mexican President Andrés Manuel López Obrador and her counterpart, Secretary of Finance and Public Credit Rogelio Ramírez de la O, on Thursday, following meetings with law enforcement, private enterprise and officials with the country’s central bank.

Yellen’s task of tamping down on one kind of trade while fostering another is a reflection of the complicated U.S.-Mexico relationship, which is now the largest country-to-country trade relationship in the world.

On the law enforcement front, Treasury announced Monday a new “Counter-Fentanyl Strike Force,” tasked with attacking drug cartels through their financial activities.

“Through this strike force we will conduct joint analyses of the financial flows of fentanyl trafficking networks, we’ll strengthen operational coordination of both civil and criminal investigations and we’ll partner with local and federal law enforcement to share information,” said an administration official.

Though administration officials lauded cooperation with Mexico on money laundering, the country remains on the State Department’s list of jurisdictions of primary concern for the practice.

Countries are placed on that list for their financial systems’ exposure risk to engaging in transactions with proceeds of criminal activities, regardless of a country’s efforts to combat money laundering.

Treasury officials said the new strike force will attempt to disrupt fentanyl production at every level of its supply chain.

“This supply chain is largely disguised as legitimate commercial trade. So one of the key values is exposing and disrupting these networks to cut off access to financial and commercial channels that these cartels are trying to operate in undetected,” said an official.

Yellen’s parallel task in Mexico will be to strengthen the North American supply chain through “friendshoring,” or pursuing complementary industrial policies throughout the continent.

“We believe that it’s in America’s and Mexico’s interest that Mexico implements economic policies that increase sustainable growth, generating more good paying jobs and prosperity for all Mexicans as part of strengthening our bilateral economic relationship,” said an administration official.

She’s likely to get an earful on that topic from Mexican private enterprise, who at times have butted heads with López Obrador, primarily over investments in infrastructure and the country’s ongoing cartel violence.

Yellen will also participate at the unveiling of a new 20-peso coin commemorating 200 years of formal diplomatic relations between the two countries.