The Mexican government, has announced a proposal to raise import tariffs on products coming from countries with which Mexico has no free-trade agreements, particularly targeting goods from Asia; which measure is still pending congressional approval.
According to the mexican government, the initiative is part of the Protection Program for Mexico´s Strategic Industries, and aims to strengthen domestic industry, while reducing unfair competition from low-cost imports, framing it as part of a broader national strategy to boost industrial self-reliance.
SCOPE
- Increase tariffs up to 50% on 1,463 HTS codes, which includes a wide range of products including automobiles, textiles, steel, paper, glass, cosmetics, and motorcycles.
- Coverage of 19 strategic sectors.
- Impact on USD 52 billion in imports (8.6% of total national imports).
AFFECTED INDUSTRIES AND SECTORS
IMPACT TO CHINESE IMPORTS
China is one of the main affected countries by this proposal, given that chinese imports account for approximately 20% of Mexico’s total imports, including: vehicles, auto parts, steel, and textiles, among others.
Chinese-made vehicles, which have rapidly gained market share in Mexico, and account for around a fifth of new car sales in the country, would face some of the highest tariff hikes. In regards to auto parts, China exported approximately US$7.2 billion worth of auto components to Mexico in 2024, representing nearly 7% of China’s total auto parts export.
Therefore, tariff increases of up to 50% could therefore sharply reduce the competitiveness of Chinese imports in Mexico.
China urges Mexico to think twice before establishing tariffs, and stating they could respond with retaliating measures.
IMPACT FOR MEXICO
Experts estimate that tariffs will cause price increases of up to 80 percent on appliances, furniture, textiles, footwear, and other products.
EFFECTIVE DATE
The initiative establishes that the decree will enter into force 30 days after its publication in the Official Gazette of the Federation (DOF), which has not been published yet and will remain valid until December 31, 2026.