Mexico announced plans to raise tariffs on automobiles from China and other Asian nations to 50% as part of a larger change in import taxes aimed at protecting jobs. This new approach will also affect various sectors, including textiles and steel, impacting $52 billion of imported goods. The Economy Minister, Marcelo Ebrard, stated that current tariffs on Chinese cars are at 20%, and the increase will help local businesses compete by providing necessary protection.
China has expressed strong opposition to these tariff increases, arguing against being pressured by other nations. The Chinese Foreign Ministry urged Mexico to collaborate with them for global economic recovery and trade development. The new tariffs must still be approved by Mexico’s Congress, which is likely given the government’s majority.
These tariffs will impact nations without trade agreements with Mexico, particularly China, South Korea, India, Indonesia, Russia, Thailand, and Turkey. Approximately 8.6% of imports will be affected, protecting about 325,000 jobs in the industrial and manufacturing sectors. Other measures include a 35% tariff on steel, toys, and motorcycles, while textiles will see levies ranging from 10% to 50%. The move aligns with U. S. efforts to limit China’s economic influence in Latin America.
RESPONDING TO U.S. PRESSURE
Banco BASE analyst Gabriela Siller stated that new tariffs are expected to increase short-term demand for Chinese vehicles. She mentioned these tariffs aim to generate more revenue and improve relations with Trump. John Price, managing director at Americas Market Intelligence, noted that Mexico is balancing U. S. pressure while trying to safeguard its successful industrial policies. He highlighted Mexico’s intent to raise an additional $3.76 billion through tariffs next year. The U. S. and Mexico, key trading partners under a free trade agreement, plan to review this agreement next year.
With information from Reuters
