Isolating U.S. companies from cartel activities could be almost impossible given that the criminal groups operate in sectors like agriculture and tourism, leaving some American businesses vulnerable to sanctions.

By Maria Abi-Habib and Simon Romero

Reporting from Mexico City

President Trump’s executive order designating Mexican cartels and other criminal organizations as foreign terrorists could force some American companies to forgo doing business in Mexico rather than risk U.S. sanctions, according to former government officials and analysts — an outcome that could have a major effect on both countries given their deep economic interdependence.

The executive order, which Mr. Trump signed on Monday, is intended to apply maximum pressure on Mexico to rein in its dangerous drug trade. The designation, more generally, also gives his administration more power to impose economic penalties and travel restrictions, and potentially even to take military action in foreign countries.

Yet, disentangling cartel operations from U.S. interests in Mexico could be immensely complicated. Mexico is the United States’ largest trade partner of goods, and many American companies have manufacturing operations there.

Even more complicated, these criminal networks have extended their operations far beyond drug trafficking and human smuggling. They are now embedded in a wide swath of the legal economy, from avocado farming to the country’s billion-dollar tourism industry, making it hard to be absolutely sure that American companies are isolated from cartel activities.

“This has come up in previous administrations across the political spectrum and from members of Congress who have wanted to do it,” said Samantha Sultoon, a senior adviser on sanctions policy and threat finance in the Trump and Biden administrations.

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Source: www.nytimes.com