President Claudia Sheinbaum Pardo said tariffs could cause more inflation and result in job losses for the U.S. and Mexico.

MEXICO CITY (AP) — President Claudia Sheinbaum suggested Tuesday that Mexico could retaliate with tariffs of its own, after U.S. President-elect Donald Trump threatened to impose 25% tariffs on Mexican goods if the country doesn’t stop the flow of drugs and migrants across the border.

Mexico and Canada are the United States’ top two trading partners, accounting for nearly 30% of trade volumes.