President Trump backed off his plan to impose tariffs on all Mexican goods and announced via Twitter on Friday night that the US had reached an agreement with Mexico to reduce the flow of migrants to the southwestern border.

Trump tweeted the announcement only hours after returning from Europe and following several days of intense and sometimes difficult negotiations between American and Mexican officials in Washington.

The President’s threat that he would impose potentially crippling tariffs on the US’s largest trading partner and one of its closest allies brought both countries to the brink of an economic and diplomatic crisis — only to be yanked back from the precipice nine days later.

The threat had rattled companies across North America, including automakers and agricultural firms, which have built supply chains across Mexico, the US and Canada.

Businesses had warned that the tariffs would increase costs for American consumers, who import everything from cucumbers to refrigerators from Mexico, and prompt retaliation from the Mexican government in the form of new trade barriers that would damage the US economy.

But the trade war ended before it began, forestalling that economic reckoning and an intraparty war that Trump had created by threatening tariffs to leverage the immigration changes he demanded. That tactic had drawn stiff protests from Republicans, including many senators, who have long opposed tariffs and worried the measure would hurt American companies and consumers.

In an unusual show of force against their own party’s president, Republican senators had threatened to try to block the tariffs if Trump moved ahead with them, and had demanded a face-to-face meeting with the President before any action.

For Mexico, the President’s threat was a replay of past episodes in which Trump ranted about the country’s lack of immigration enforcement. This year, he threatened to shut down the entire southwestern border, backing off only after aides showed him evidence that Mexican authorities were taking aggressive action to stop migrants.

This time, Mexican authorities were under similar pressure to find something that would mollify Trump.

According to a US-Mexico Joint Declaration distributed late on Friday, Mexico agreed to “take unprecedented steps to increase enforcement to curb irregular migration”, including the deployment of its national guard throughout the country to stop migrants from reaching the US.

The declaration, distributed by the state department, said Mexico had also agreed to accept an expansion of a Trump administration program that makes some migrants wait in Mexico while their asylum claims are heard in the US.

“The US looks forward to working alongside Mexico to fulfill these commitments so that we can stem the tide of illegal migration across our southern border and to make our border strong and secure,” secretary of state Mike Pompeo said in a statement.