The USA and Mexico sought to undertaking a united entrance on Thursday of their efforts to deepen financial ties and crack down on illicit drug smuggling because the Biden administration appears to be like to solidify its North American provide chain and cut back reliance on China.

On the conclusion of three days of conferences in Mexico Metropolis, Treasury Secretary Janet L. Yellen introduced that the U.S. and Mexico would start working extra carefully to display overseas investments coming into each international locations with a brand new working group to weed out potential nationwide safety threats.

The collaboration comes because the administration appears to be like to make sure that allies akin to Mexico are in a position to partake of the billions of {dollars} of home vitality and local weather investments that the US is deploying. Nevertheless, because the administration seeks nearer cross-border financial integration, it needs to make sure that Mexico isn’t the recipient of probably problematic investments from international locations akin to China.

“Elevated engagement with Mexico will assist keep an open funding local weather whereas monitoring and addressing safety dangers, making each our international locations safer,” Ms. Yellen mentioned at a information convention on Thursday.

In Mexico, Ms. Yellen has needed to strike a fragile steadiness, pushing her counterparts there to work tougher to confront fentanyl trafficking into the U.S. whereas making an attempt to deepen financial ties at a time when China can also be investing closely to construct factories there.

Ms. Yellen has embraced Mexico, America’s largest trading partner, as a pleasant ally throughout her journey — visiting drug-sniffing canine and holding talks with prime Mexican leaders. However there may be rising frustration inside the Biden administration over what officers understand as President Andrés Manuel López Obrador’s unwillingness to put money into efforts to fight fentanyl trafficking within the area. An growing variety of U.S. officers have grow to be extra outspoken in latest months over the necessity to stress Mexico to do extra to crack down on fentanyl.

“The illicit trafficking of fentanyl devastates households and communities and poses a risk to our nationwide safety whereas additionally undermining public security in Mexico,” Ms. Yellen mentioned.

Practically 110,000 folks died final 12 months of drug overdoses in the US, a disaster that U.S. officers say is basically pushed by the chemical elements for fentanyl getting shipped from China to Mexico and became the potent artificial drug that’s then trafficked over the southern border into the US.

Mr. López Obrador has usually rejected the notion that fentanyl is produced in his nation and described the U.S. drug disaster as a “downside of social decay.” He has argued that American politicians shouldn’t use his nation as a scapegoat for the report variety of overdoses in the US. The rising variety of fentanyl-related deaths have fueled calls by Republican presidential candidates to take army motion in opposition to Mexico.

In February, Anne Milgram, the Drug Enforcement Administration administrator, mentioned her company was nonetheless not receiving adequate info from Mexican authorities about fentanyl seizures or the entry of precursor chemical compounds in that nation, and that the US was more and more involved over the variety of laboratories used to supply fentanyl in Mexico.

And in October, on the eve of Secretary Antony J. Blinken’s go to with President López Obrador in Mexico, Todd Robinson, the State Division’s assistant secretary of the bureau of worldwide narcotics and regulation enforcement affairs, informed The New York Instances that the Mexican president was not acknowledging the severity of the drug disaster within the area.

The Mexican president would quite be within the class of “somebody who has an issue however doesn’t comprehend it,” he mentioned.

Mr. Robinson, in addition to officers within the Treasury Division, additionally consider Mexico should do extra to bulk up its ports to intercept fentanyl precursors coming from China. Each Republicans and Democrats are particularly involved over a port in Manzanillo, Mexico, that they are saying is a main hub for fentanyl precursors.

The USA within the meantime has more and more relied on the instruments of the Treasury Division to focus on drug organizations in Mexico which are trafficking the damaging drug to the US.

Brian Nelson, the beneath secretary for terrorism and monetary intelligence on the Treasury Division, mentioned in an interview in October that the division would proceed to make use of sanctions to stress cartel organizations and suppliers of fentanyl chemical compounds.

“We’ll proceed to make use of our instruments to map and hint the community’s suppliers of the precursor medicine which are flowing into Mexico from overseas international locations, together with China; the cash laundering organizations that help the monetary flows that allow this felony enterprise,” Mr. Nelson mentioned.

The Treasury Division accelerated these efforts this week with the creation of a brand new “counter-fentanyl strike drive” that may purpose to extra aggressively scrutinize the funds of suspected narcotics sellers. On Wednesday, Ms. Yellen introduced that the Treasury Division was imposing new sanctions in opposition to 15 Mexican people and two corporations which are linked to the Beltrán Leyva Group, a significant distributor of fentanyl into the U.S.

On the similar time that the Biden administration is making an attempt to curb the circulation of medicine coming from Mexico, Ms. Yellen emphasised a want for extra commerce between the 2 international locations and famous that the U.S. advantages from imports of Mexican metal, iron, glass and automobile elements.

The 2022 Inflation Discount Act regulation within the U.S. permits American customers to learn from tax credit for electrical autos which are assembled in Mexico, and Ms. Yellen mentioned that she needs to see the car sector provide chain extra tightly built-in between the 2 international locations.

“The USA continues to pursue what I’ve referred to as friend-shoring: searching for to strengthen our financial resilience by way of diversifying our provide chains throughout a variety of trusted allies and companions,” Ms. Yellen mentioned.

On the information convention, Ms. Yellen pushed again in opposition to the concept the U.S. was encouraging Mexico to undertake extra rigorous overseas funding safeguards as a result of it wished to discourage Chinese language funding there.

“So long as there are applicable nationwide safety screens and people investments don’t create nationwide safety issues for Mexico or the US, now we have completely no downside with China investing in Mexico to supply items and companies that shall be imported into the US,” Ms. Yellen mentioned.