Mexican President cancels U.S. trip after Trump's tweet

Trump moves to build wall and restrict refugee entry into US during first week as President

"I've said time again; Mexico will not pay for any wall", the Mexican president said in a video statement posted to Twitter and translated by CNN.

"I work with the Mexican people all the time - great relationships", Trump said.

The border wall with Mexico-and the promise that "Mexico will pay for it"-was one of the pillars of Trump's presidential campaign". Spicer quickly walked that back, noting it was just suggested as one of many potential methods of forcing Mexico to pay back the US for the construction of a wall that is estimated to cost $25 billion. But by doing it that way we can do $10 billion a year and easily pay for the wall.

During his speech at the Republican retreat in Philadelphia Thursday, Trump said he and Peña Nieto "agreed" to cancel their planned meeting.

Trump also said if Mexico refuses to reimburse the United States for the barrier, he will impose a new trade tax that will cover the cost.

Speaking at a three-day Republican retreat in Philadelphia, Mr Trump suggested that the meeting was cancelled by mutual agreement when in fact Mr Peña Nieto announced the decision while the USA president was flying to Pennsylvania.

"That unpredictability of reaction creates problems", Guajardo said, referring to Trump's Thursday tweet even as he praised a constructive attitude of other members of Trump's team including Trump strategist Stephen Bannon.

They did not reveal the content of the call or who initiated it.

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The U.S. has a 60 billion dollar trade deficit with Mexico.

The standoff with Mexico's president has been the first full-blown foreign policy clash with a foreign leader of the Trump administration.

Trump did not discuss payment of the border wall during the press conference.

Mr Trump on Wednesday signed an executive order to create a wall on the USA southern border with Mexico.

He added: "We are going to get the bad ones out".

As the Statista chart shows, the U.S. imports over $50bn worth of motor vehicles and almost $44bn worth of vehicle parts from Mexico.

"They will be enforced and enforced strongly", Trump said.