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Mexico struggles strongly with security, it's lack of good non-corrupt cops and security, while everyone struggles with corruption in the security system, Mexico struggles with a drug was and gang violence to an extreme. There is so much literature about the struggles Mexico has revolving Security, most against. President Nieto also recognizes it's struggle, he recognizes that he can't sufficiently help the United States on border control. Mexico attempts to to help to keep good foreign relations, but realize their security isn't good enough and neither is ours. It isn't cutting it. This fence would /probably/ do nothing to foreign relations, at least that's my opinion based strictly off of Security.
What the 700 mile fence would do is create a legal barrier that has been constructed because citizens of Mexico and others come across the border into the United States illegally. Citizens of Mexico are invited to come into the United States of America legally just as citizens of the United States of America are invited to come into Mexico. Citizens of Mexico coming into the United States illegally is not acceptable just as citizens of the United States are not invited to come into Mexico illegally. Comparison of treatment of illegal entrants by the United States of American and by Mexico is very telling in the attitude of Mexico DOES NOT MEET the level of attitude of the United States of America. Mexico could build a fence if it wished to and the United States of America would accept that action with approval. Building of a fence is a clear statement that coming into either country legally is accepted; coming into either county illegally is not accepted.
No, a 700 mile US Mexico border fence would not benefit foreign relations. Fences are barriers, both literal and figurative. A US Mexico border fence, constructed by the US, would send a message to Mexico that the US is not open and willing to negotiate in most anything at all.
Building a 700 mile border fence would not hurt or help our foreign relations. It could, theoretically, hurt our relations with Mexico, but that's about it. I don't know, however, whether it would actually hurt our relations with Mexico at all. For other countries, I don't think it would matter whether we built a border fence.
Neither Canada or Mexico will allow us to enter their countries illegally so who cares if us putting up a fence along our borders upsets them? Besides, it's our borders, we can put up whatever we want without needing the approval of other countries and if the UN doesn't like it, they can pack their bags and get out too.