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Mexico has approved tariffs of up to 50 per cent on Chinese cars and other goods, aligning with US President Donald Trump’s protectionist policies, as it seeks to preserve a pivotal free-trade deal with its neighbour next year.
The Mexican Senate voted late on Wednesday to confirm the levy, proposed in September, that will apply to about 1,400 goods imported from China and other countries with which Mexico lacks a trade deal.
While it will affect goods ranging from trainers to microwaves, Chinese cars will be hit the hardest.
President Claudia Sheinbaum on Thursday insisted the tariff was not directed at China alone “but all countries with which we don’t have trade deals. Because if not, it would seem that Mexico is putting restrictions on trade.”
Sheinbaum said Mexico’s aim was to strengthen its own industry — including textiles and car parts — but the government remained “completely willing to continue working” with China and affected countries.
The tariff comes after Trump pressed Sheinbaum to curb Beijing’s growing economic influence in Mexico and to back his migration and security policies. Mexico is the US’s top trading partner and its imports from China — worth almost $130bn last year — have grown more than 75 per cent since 2020.
A review of the US-Mexico-Canada trade pact, agreed during Trump’s first term, is due next year, with the Office of the US Trade Representative set to outline in January whether it supports extending the USMCA pact by 16 years.
Antonio Ortiz-Mena, adjunct professor of Georgetown University and president of AOM Advisors, said while apparel, home appliances, motorcycles and other affected products “are not intermediate goods destined for export to the US, and therefore have no connection to USMCA . . . by signalling vigilance against . . . unfair trade practices, Mexico may ease some US concerns ahead of the 2026 review.”
The US has accused China of using Mexico as a “back door” for goods to circumvent high US tariffs.
However, Ortiz-Mena said “sweeping all non-FTA [free trade agreement] countries creates negative spillovers for partners with which Mexico has no particular unfair trade concerns” — notably South Korea, India and Brazil.
Mexico’s new 50 per cent levy — more than double the current 15 per cent to 20 per cent tariff — was the highest allowed under World Trade Organization rules.
Chinese imports make up a fifth of Mexican imports, official statistics show, and in November, 20 per cent of cars sold in Mexico were imported from China, according to the Mexican Association of Automotive Distributors.
Mexico was the world’s biggest buyer of Chinese-made cars in the first half of this year, according to Shanghai consultancy Automobility.
China’s commerce ministry said it opposed “unilateral tariff increases” and had launched an investigation into trade and investment barriers in Mexico.
There was no immediate reaction from the US.
The tariffs, which the government expects will bring in more than $2.5bn in extra revenue next year, will take effect from January.
Lawmakers approved the measure in Mexico’s upper chamber by 76 to five, with 35 abstentions, in a fast-track process.
Analysts fear the tariff move could be viewed as Mexico giving way under pressure from the unpredictable US president. It fuelled hopes that, in return, tough US tariffs on Mexican steel and aluminium could be eased.
The USMCA, covering a trade bloc encompassing 500mn people accounting for 30 per cent of global GDP, gives Mexico privileged access to the US. Almost 90 per cent of its exports to the US are tariff-free — a competitive advantage Sheinbaum is determined to preserve.
Trump imposed a tariff of 25 per cent on Mexican exports to the US, but goods covered by the USMCA were waived.
This week, the US president threatened Mexico with a new 5 per cent tariff, alleging it was violating a water supply treaty from the 1940s. Sheinbaum said Mexico has not met the terms because there has been insufficient rain, and she is negotiating with the US to find a solution.
Additional reporting by Cheng Leng, Joe Leahy and Paula Simón. Data visualisation by Anna Marie Alcantara
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