Business on the US-Mexico border is already feeling the fallout from Trump's squabble with Mexico

During Donald Trump's presidential campaign, the Mexican peso often tracked his poll numbers, rising when he fell and falling when he surged.

And, in keeping with that trend, in the days since he's taken office the peso has mirrored the seeming deterioration of US-Mexican relations.

The currency's swings haven't taken place in a vacuum, however.

See more on the U.S.-Mexico border:

21 PHOTOS
Life along Mexico's border with the United States
See Gallery
Life along Mexico's border with the United States
IMPERIAL SAND DUNES, CA - SEPTEMBER 28: A digger removes sand drifts from the Mexican side of the U.S.-Mexico border fence on September 28, 2016 in the Imperial Sand Dunes recreation center, California. Without daily removal of the sand, the dunes would cover the fence and undocumented immigrants and smugglers could simply walk over it. The border stretches almost 2,000 miles between Mexico and the United States. Border security and immigration issues have become major issues in the U.S. Presidential campaign. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: People meet loved ones through the U.S.-Mexico border fence on September 25, 2016 in Tijuana, Mexico. The U.S. Border Patrol opens the park on the American side in San Diego on weekends to meet through the fence with family and friends through the fence at Tijuana. The park is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 24: Haitian refugees look over donated items at an immigrant center on September 24, 2016 in Tijuana, Mexico. In recent months a surge of Haitian refugees has arrived to Tijuana, seeking asylum at the border crossing into the United States. The center, called the Desayunador Salesiano Padre Chava, serves breakfast to more than 1,000 immigrants daily, many of them deportees from the United States. (Photo by John Moore/Getty Images)
IMPERIAL SAND DUNES, CA - SEPTEMBER 28: A digger removes sand drifts along the U.S.-Mexico border fence on September 28, 2016 in the Imperial Sand Dunes recreation center, California. Without daily removal of the sand, the dunes would cover the fence and undocumented immigrants and smugglers could simply walk over it. The border stretches almost 2,000 miles between Mexico and the United States. Border security and immigration issues have become major issues in the U.S. Presidential campaign. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: People enjoy a late afternoon near the U.S.-Mexico border fence on September 25, 2016 in Tijuana, Mexico. Friendship Park, located on the border between the two countries is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 24: Immigrants, many of them deportees from the United States, eat breakfast at a soup kitchen on September 24, 2016 in Tijuana, Mexico. The center, called the Desayunador Salesiano Padre Chava, is run by a Catholic order of priests and feeds more than than 1,000 immigrants each morning. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 24: People stand in line to cross legally into the United States from Mexico on September 24, 2016 in Tijuana, Mexico. Securing the border and controlling illegal immigration have become key issues in the U.S. Presidential campaign. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: A couple holds hands while meeting loved ones through the U.S.-Mexico border fence on September 25, 2016 in Tijuana, Mexico. The U.S. Border Patrol opens the park on the American side in San Diego on weekends to meet through the fence with family and friends through the fence at Tijuana. The park is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: People enjoy a late afternoon near the U.S.-Mexico border fence which ends in the Pacific Ocean on September 25, 2016 in Tijuana, Mexico. Friendship Park, located on the border between the two countries is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: Mexicans enjoy a late afternoon near the U.S.-Mexico border fence which ends in the Pacific Ocean on September 25, 2016 in Tijuana, Mexico. Friendship Park, located on the border between the two countries is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: A child plays in the Pacific surf near the U.S.-Mexico border fence on September 25, 2016 in Tijuana, Mexico. The nearby Friendship Park is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: Immigrant activists pray at the U.S.-Mexico border fence on September 25, 2016 in Tijuana, Mexico. The U.S. Border Patrol opens the park on the American side in San Diego on weekends to meet through the fence with family and friends through the fence at Tijuana. The park is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: Maria Rodriguez Torres, 70, embraces a grandchild after seeing her other grandchildren for the first time through the U.S.-Mexico border fence on September 25, 2016 in Tijuana, Mexico. She had traveled with family members from Mexico City to see her grandchildren through the fence at 'Friendship Park.' The U.S. Border Patrol opens the park on the American side on weekends to meet through the fence with family and friends through the fence at Tijuana. The park is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
JACAMBA HOT SPRINGS, CA - SEPTEMBER 26: Residents line up to receive free food at mobile food pantry near the U.S.-Mexico border on September 26, 2016 in Jacamba Hot Springs, California. The Feeding America truck delivers to the border town's needy residents twice a month. (Photo by John Moore/Getty Images)
JACAMBA HOT SPRINGS, CA - SEPTEMBER 26: A U.S. Border Patrol vehicle stands guard along the U.S.-Mexico border fence on September 26, 2016 in Jacamba Hot Springs, California. (Photo by John Moore/Getty Images)
JACAMBA HOT SPRINGS, MEXICO - SEPTEMBER 26: A cardboard cutout of Democratic presidential candidate Hillary Clinton is on display at a debate-watching party for supporters of Hillary Clinton at the Yum Yum Chinese restaurant near the U.S.-Mexico border on September 26, 2016 in Calexico, California. People across the country tuned in as Republican Presidential candidate Donald Trump and Democratic candidate Hillary Clinton participated in their first debate. (Photo by John Moore/Getty Images)
HOLTVILLE, CA - SEPTEMBER 27: Mexican farm workers hoe a cabbage field on September 27, 2016 Holtville, California. Thousands of Mexican seasonal workers legally cross the border daily from Mexicali, Mexico to work the fields of Imperial Valley, California, some of the most productive farmland in the United States. (Photo by John Moore/Getty Images)
HOLTVILLE, CA - SEPTEMBER 27: A A Mexican farm worker plows a U.S. farm on September 27, 2016 in Holtville, California. Thousands of Mexican seasonal workers legally cross the border daily from Mexicali, Mexico to work the fields of Imperial Valley, California, some of the most productive farmland in the United States. (Photo by John Moore/Getty Images)
HOLTVILLE, CA - SEPTEMBER 27: A marker stands over an immigrant's grave on September 27, 2016 in Holtville, California. Hundreds of immigrants, many who died while crossing the desert from Mexico into the United States, are buried in a pauper's cemetery. Many of the grave markers simply read 'John Doe.' (Photo by John Moore/Getty Images)
TIJUANA, MEXICO - SEPTEMBER 25: A man looks through the U.S.-Mexico border fence into the United States on September 25, 2016 in Tijuana, Mexico. Friendship Park on the border is one of the few places on the 2,000-mile border where separated families are allowed to meet. (Photo by John Moore/Getty Images)
HIDE CAPTION
SHOW CAPTION
of
SEE ALL
BACK TO SLIDE

Commerce on the frontier, where businesses and consumers often stretch across the border, has started to feel the uncertainty of US-Mexico relations in the Donald Trump era.

"There are businesses that depend on the ways that the border is porous, and there are businesses that depend on the ways that the border is solid. The former are mostly in retail," Patrick Iber, an assistant professor of history at the University of Texas at El Paso, told Business Insider.

"If you look at a map of El Paso, there is a neighborhood called Chihuahuita right across the main bridge crossing between here and Juárez," in Mexico, Iber said. "And lots of relatively poor people [from Mexico] ... shop in the downscale wholesale markets that line the streets there."

The peso's struggles, rising nearly 13% against the dollar since the beginning of November, have negatively affected the purchasing power of Mexicans shopping in the US, in turn putting a chill on outlets on the US side of the border that cater to them.

"These are the places that I have heard are failing," Iber said of the markets in Chihuahuita, "because they depend on the small amounts of disposal income among relatively poor Mexican shoppers."

But the Mexican consumption in El Paso and Texas more broadly is not limited to people shopping at stalls within walking distance of the border.

See more on the U.S. border:

30 PHOTOS
Where the wall already exists along the US-Mexico border
See Gallery
Where the wall already exists along the US-Mexico border
A gap in the U.S.-Mexico border fence is seen outside Jacumba, California, United States, October 7, 2016. REUTERS/Mike Blake 
U.S. customs and border patrol officers inspect a vehicle entering the U.S. from Mexico at the border crossing in San Ysidro, California, United States, October 14, 2016. REUTERS/Mike Blake 
U.S. customs and border patrol officers inspect a vehicle entering the U.S. from Mexico at the border crossing in San Ysidro, California, United States, October 14, 2016. REUTERS/Mike Blake 
Men talk on a street in the town of Calexico, California, United States, October 8, 2016. REUTERS/Mike Blake 
A U.S. customs and border patrol officer stands at a border crossing in San Ysidro, California, United States, October 14, 2016. REUTERS/Mike Blake
Recent arrivals from Mexico wait to board a greyhound bus in San Ysidro, California, United States, October 14, 2016. REUTERS/Mike Blake
Highway 82 towards Douglas, Arizona is seen near Sonoita, Arizona, United States, October 10, 2016. REUTERS/Mike Blake 
Clouds float above the border towns of Nogales, Mexico and Nogales, Arizona, United States, October 9, 2016. REUTERS/Mike Blake 
A sign warning drivers that firearms and ammunition are prohibited in Mexico is seen at the U.S.-Mexico border in Nogales, Arizona, United States, October 9, 2016. REUTERS/Mike Blake
Buildings in Nogales, Mexico (R) are separated by a border fence from Nogales, Arizona, United Sates, October 9, 2016. REUTERS/Mike Blake
An abandoned car sits off the side of a road near Jacumba, California, United States, October 7, 2016. REUTERS/Mike Blake 
A worker makes his way through the water after setting up an irrigation system on an agricultural field, near Calexico, California, U.S. October 7, 2016. REUTERS/Mike Blake
An abandoned car sits off the side of a road near Jacumba, California, United States, October 7, 2016. REUTERS/Mike Blake 
A church at the Museum of History in Granite is seen in Felicity, California, United States, October 8, 2016. REUTERS/Mike Blake
A man drives a tractor plowing a field at sunrise near Calexico, California, United States, October 8, 2016. REUTERS/Mike Blake 
Residential homes are seen next to the fence that borders Mexico, in Douglas, Arizona, United States, October 10, 2016. REUTERS/Mike Blake
Pedestrians wait to cross the street in Calexico, California, Unites States, October 7, 2016. REUTERS/Mike Blake
The town of Bisbee is seen in Arizona, United States, October 10, 2016. REUTERS/Mike Blake
Pedestrians make their way into the the United States from Mexico at the pedestrian border in Nogales, Arizona, United States, October 9, 2016. REUTERS/Mike Blake
A roadside collection of alien dolls and toy UFO saucers is seen next to a roadside residence neat Jacumba, California, United States, October 7, 2016. REUTERS/Mike Blake
A road abruptly ends next to a sign for a cattle ranch near Douglas, Arizona, United States, October 10, 2016. REUTERS/Mike Blake
A boy rides an all-terrain vehicle next Mexican border along the Buttercup San Dunes in California, United States, October 8, 2016. REUTERS/Mike Blake
An old refurbished gas station is seen in Lowell, Arizona, United States, October 10, 2016. REUTERS/Mike Blake 
A man rides a tricycle past a grocery store in a town that borders Mexico, in San Luis Butter, California, United States, October 8, 2016. REUTERS/Mike Blake 
A U.S. customs and border patrol truck drives past the fence that marks the border between U.S. and Mexico, in Calexico, California, United States, October 8, 2016. REUTERS/Mike Blake
A truck drives west towards California along highway 8 near Gila Bend, Arizona, United States, October 10, 2016. REUTERS/Mike Blake
Electronic items are displayed in a shop window in Calexico, California, United States, October 7, 2016. REUTERS/Mike Blake 
A residential home is seen in Nogales, Arizona, United States, October 9, 2016. REUTERS/Mike Blake 
A fence separates the border towns of Nogales, Mexico (R) and Nogales, Arizona, United Sates, October 9, 2016. REUTERS/Mike Blake
HIDE CAPTION
SHOW CAPTION
of
SEE ALL
BACK TO SLIDE

"The shoppers who come over from Mexico are very important, especially for taxing entities," David Stout, the El Paso County commissioner from Precinct 2, told The Morning News in December. "We rely heavily on the sales tax revenue we generate."

The Rio Grande Valley, east of El Paso at the the southern tip of Texas, has some of the highest-volume retail space in the US because of visitors coming from Mexico, according to The Dallas Morning News.

While wealthier Mexican shoppers have, for the time being, been undeterred by the peso's fall against the dollar ("They don't even look at the prices," an El Paso sales associate told The Morning News), the weaker exchange rate "has stopped some budget-conscious Mexican shoppers from crossing as often to buy in Texas," according to The Morning News.

Poor purchasing power isn't the only recent development making Mexicans reluctant to cross the border. Trump's hardline position on deportation and border enforcement has sent a chill throughout the immigrant community in the US, particularly in Texas.

"Even at UTEP, something like 6% of our student body crosses the Juárez bridge daily to attend school," Iber said. With Trump's move toward a more aggressive deportation policy that, according to one immigration lawyer, gives the administration "carte blanche" to round up immigrants in the US, "People are naturally, and rightly worried," Iber added.

"One graduate student saw an El Paso lawyer tweet that even if you have a legal visa, don't cross the border after 6pm because border patrol agents were confiscating visas," Iber told Business Insider.

"I can't confirm that, but people hear those kinds of rumors (which may well be true), and it threatens the legal crossings that take place by the thousands every day. Families with relatives on both sides will be afraid to visit each other."

The business community in Texas, which went to Trump in the election by nearly a million votes, has also blanched at the president's apparent efforts to redo or even scrap the NAFTA trade deal that has powered US-Mexico commerce for more than 20 years.

In June 2016, at a private fundraiser for Trump, Dennis Nixon, a banker in Laredo, Texas, and one the event's hosts, sent a message to the then presidential candidate during his introduction.

"Mr. Trump, we must support trade, but I agree we need fair trade ... And here in South Texas, NAFTA meets the definition," Nixon said, according to The Texas Tribune.

See more on the border:

16 PHOTOS
Touching scenes from the US-Mexico border
See Gallery
Touching scenes from the US-Mexico border

Martha Morales and Juan Manuel Gonzalez Camacho hug their grandaughter Aileen Gonalez and son Adrian Gonalez Morales as they are allowed to meet after a door is opened along the United States-Mexico Border wall during Opening the Door Of Hope/Abriendo La Puerta De La Esparana at Friendship Park in San Ysidro, California on Saturday, November 19, 2016.

(SANDY HUFFAKER/AFP/Getty Images)

U.S. Border patrol agents stand at an open gate on the fence along the Mexico border to allow Adrian Gonzalez-Morales and his daughter Aileen hug his parents Juan and Martha, as part of Universal Children's Day at the Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

U.S. Border patrol agents stand at an open gate on the fence along the Mexico border to allow Luis Eduardo Hernandez-Bautista hug Ty'Jahnae Williams and his father Eduardo Hernandez (not in view), as part of Universal Children's Day at the Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

Family members hug during a U.S. Border Patrol sponsored visit at the U.S.-Mexico border fence in Tijuana, Mexico, on Saturday, Nov. 19, 2016. The U.S. Border Patrol, in coordination with immigrant rights groups, opened the metal gate so that previously selected families could visit for several minutes.

(Photographer: David Maung/Bloomberg via Getty Images)

A woman in Friendship Park in San Diego, California, U.S. speaks with children across a fence separating Mexico and the United States, November 12, 2016. Picture taken from Tijuana, Mexico.

(REUTERS/Jorge Duenes)

U.S. Border patrol agents stand at an open gate on the fence along the Mexico border to allow Edith Hernandez and her daughter Yvette hug Maria Plata-Colin, as part of Universal Children's Day at Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

People in Friendship Park in San Diego, California, U.S. are seen behind a fence separating Mexico and the United States, November 12, 2016. Picture taken from Tijuana, Mexico.

(REUTERS/Jorge Duenes)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

Luis Hernandez hugs his Father Eduardo as they are allowed to meet after a door is opened along the United States - Mexico Border wall during Opening the Door Of Hope / Abriendo La Puerta De La Esparana at Friendship Park in San Ysidro, California on Saturday, November 19, 2016.

(SANDY HUFFAKER/AFP/Getty Images)

Members of the Gonzalez family hug each other and react as they encounter at the gate of the U.S.- Mexico border fence opened for a few minutes on November 19, 2016 in Playas de Tijuana, Mexico. The door opening was organized by pro-migrants NGOs and local authorities in coordination with the United States Border Patrol.

(GUILLERMO ARIAS/AFP/Getty Images)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

A U.S. Border patrol agent stands at an open gate on the fence along the Mexico border to allow Laura Avila and her daughter Laura Vera Martinez hug Maria Socorro Martinez Lopez, as part of Universal Children's Day at the Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

A young boy joins his family members as they hug during a U.S. Border Patrol sponsored visit at the U.S.-Mexico border fence in Tijuana, Mexico, on Saturday, Nov. 19, 2016. The U.S. Border Patrol, in coordination with immigrant rights groups, opened the metal gate so that previously selected families could visit for several minutes.

(Photographer: David Maung/Bloomberg via Getty Images)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

HIDE CAPTION
SHOW CAPTION
of
SEE ALL
BACK TO SLIDE

While Nixon said he agreed with Trump's assertions that US immigration is "broken," he differed with Trump's stated approach of upping spending and enforcement, saying "that the federal government already spends more on border security than all the federal law enforcement combined."

Trump appeared to acknowledge Nixon's remarks during his own comments at the fundraiser, but he later mocked the banker and dismissed the idea that being politically conservative meant supporting free trade.

"Who cares?" Trump said just hours later at a rally.

Since Trump's election, business leaders in both the US and Mexico have turned their attention to defending open cross-border trade, looking to tout the benefits both countries have gleaned from it.

"You have powerful people from Mexico talking, drinking, having dinner with very powerful Texas people," James Hollifield, a professor at Southern Methodist University and director the school's Tower Center for Political Studies, told The Morning News in December.

"These guys and gals have known each other for years ... They will push this agenda," Hollifield said. "You will see a powerful binational coalition forming between these two countries."

Indeed, Mexico is the US's second-largest export market and third-largest overall trade partner. In 2015, daily bilateral trade was worth $1.46 billion.

Texas' imports from Mexico were worth more than $84 billion in 2015, more than double the value of imports from the state's second-biggest source, China, and more than five times the value of Texas' imports from Canada.

Based on the value of 2015's imports, Texas would pay $16.8 billion more for the same goods and services if the 20% import tariff floated by the Trump administration this week were applied.

The administration quickly walked that proposal back, saying it was just an example of a plan to fund construction of Trump's vaunted border wall, but many were quick to note the deleterious impact it would have on consumers in the US.

"A 20% tax on Mex.imports to pay 4 the #BorderWall wud hav the same impact as a category 5 hurricane on the [Rio Grande Valley]~catastrophic&hard 2 overcome," tweeted Reuben O. Villarreal, a Republican and former mayor of Rio Grande City, which is on the Texas-Mexico border.

"We don't produce vegetables here in the states" in the winter, said Alfredo Duarte, president and cofounder of Taxco Produce Inc., which is based in Dallas.

"We have to import vegetables," Duarte added. "If people are still wanting to eat guacamole on Super Bowl day, we'll just go back to the time when we were paying $80 a case for avocados from California about 15 years ago."

A case, which can contain 30 to 60 avocados, currently costs about $40, according to The Morning News.

"Texas' working families and our economy depend on a strong relationship with Mexico," saidTexas Democratic Party executive director Crystal Perkins. "Minority President Donald Trump's 20-percent tax will kill Texas jobs, raise the price of goods for Texas families, and slaughter Texas' relationship with its largest trading partner."

Trump's ultimate trade policy, and what the final form his border wall will be, are still up in the air. But his aggressive posture toward the intimate relationships — both commercial and familial — that have formed along the US-Mexico border has already been felt.

"I don't know that we've ever felt safe again," Francisca Jimenez, a cleaning woman in Ciudad Juarez, told The Morning News in December. "There's also more uncertainty for Mexicans here in and in the United States with the arrival of el señor Trump."

"If Trump does what he has said he will do, it is going to affect us," truck driver Roman Diaz, 45, told AFP in January, while waiting to cross into California from Tijuana.

Mexican truckers wait years to get permits to cross into the US, joining the flow of 400,000 vehicles and a million people who cross the border into the US every day.

"We won't be able to cross any more," Diaz said. "This job of ours will be over. The uncertainty is unbearable."

"The total impact of all this is hard to gauge at the moment, because it depends a great deal on how these threats are implemented," Iber told Business Insider of the consequences of Trump's border policies.

"At the moment, net migration with Mexico is near zero. But if Trump's policies force Mexico into a depression, we're likely to get more undocumented immigration to the U.S., not less," he added. "It's a complex equilibrium at the moment, full of injustices, that Trump seems determined to make worse."

SEE ALSO: Mexicans are lashing out at their own government over Trump's border plans
NOW WATCH: 'Mexico does not believe in walls': Mexico's president rejects Trump's push for a border wall

Read Full Story

Markets

DJIA 21,750.73 -274.14 -1.24%
NASDAQ 6,221.91 -123.19 -1.94%
S&P 500 2,430.01 -38.10 -1.54%
NIKKEI 225 19,470.41 -232.22 -1.18%
HANG SENG 27,047.57 -296.65 -1.08%
DAX 12,165.00 -38.46 -0.32%
USD (per EUR) 1.17 0.00 0.21%
USD (per CHF) 0.96 0.00 -0.08%
JPY (per USD) 109.05 -0.26 -0.24%
GBP (per USD) 1.29 0.00 0.09%

Can't get enough business news?

Sign up for Finance Report by AOL and get everything from retailer news to the latest IPOs delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.