The Mexican government has announced that it will raise customs duties on automobiles imported from China and other Asian countries to 50 percent, the maximum level permitted by the World Trade Organization (WTO).
This decision is part of a vast import duty reform affecting key sectors such as automotive, steel and textiles, representing a total of $52 billion USD in imports.
Mexico’s Minister of Economy, Marcelo Ebrard, explained that the measures aim to protect local jobs, which are threatened by the arrival of Chinese vehicles sold at prices “below market-reference.” According to the government, no fewer than 325,000 industrial and manufacturing jobs are at stake.
A geopolitical decision
While Mexico justifies its reform by the need to protect its economy, several analysts see it as a direct response to pressure from Washington. The United States has been trying for several years to limit China's commercial influence in Latin America.
"The Americans are not going to allow China to use Mexico as a backdoor to their market," explained Mariana Campero, a specialist at the CSIS Americas Program.
A move contested by China
Beijing has expressed its firm opposition. A Chinese Ministry of Foreign Affairs spokesperson denounced restrictions imposed “under various pretexts” and warned that China would defend its interests.
Impact on other goods
Besides automobiles, the plan also includes duties of 35 percent on steel, toys and motorcycles, and 10 to 50 percent on textiles. The targeted countries are those without trade agreements with Mexico, which includes China, but also South Korea, India, Indonesia, Russia, Thailand and Turkey.
Delicate balance with U.S.
Mexico, which exports a large part of its automotive production to the United States, is trying to protect its industry while maintaining good trade relations with its northern neighbor.
John Price, an analyst at Americas Market Intelligence, summarizes the situation: “Mexico is trying to appease the Americans, while defending the industrial policy that has served it so well for 30 years.”
The Canada-United States-Mexico Agreement (CUSMA), which had spared Mexico from the Trump-era tariffs, is also up for review next year, a context that adds to the political pressure.