Mexico just passed sweeping new tariffs that could disrupt EV imports and fuel a fresh global trade standoff
Last month, Mexico was the most popular export market for Chinese electric vehicles. The country imported 19,344 of them, which was a 2,367% increase compared to a year ago.
That number could soon tumble as Mexico’s Congress approved steep new tariffs earlier this month. Reuters reports the move targets countries that don’t have a free trade agreement with the country.
More: Mexico Has Had Enough With Chinese Car Imports
This includes a number of Asian countries including India, Indonesia, Thailand, and South Korea. However, China is the elephant in the room as it’s one of Mexico’s largest trading partners.
A Hard Stop for Chinese Imports
While most of the tariffs are set at 35%, the ones on China are reportedly up to 50%. These will apply to 1,463 products including automobiles and car parts. Other items include motorcycles, trailers, clothing, plastic, steel, and household appliances. Tariffs will also impact imports of aluminum, shoes, paper products, and furniture.
Mexico’s Ministry of Economy recently noted the tariffs will go into effect on New Year’s Day and are designed to “safeguard approximately 350,000 jobs in the country in sensitive sectors such as footwear, textiles, clothing, steel, and automotive.” They went on to claim the tariffs will correct trade distortions and rectify a “high dependence on imports.”
The move has already angered a number of impacted countries, but the ministry said the “tariff modification is a commercial and economic measure that seeks to benefit the people of Mexico, and is therefore not directed at any particular country.”
That likely won’t placate China, which has slammed the tariffs. As the New York Times reported earlier this month, China’s Ministry of Commerce said the new fees would “substantially harm” the country as well as other impacted trading partners. They went on to urge Mexico to “correct its erroneous practices of unilateralism and protectionism as soon as possible.”
It remains unclear if China will do anything other than issue strongly worded statements, but the tariffs are expected to generate an additional $3.76 ($67.7 MXN) billion.
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