Mexico considers tariffs on Chinese imports as trade pact review looms

Mexico is evaluating new or higher tariffs on selected imports from China and other countries, with steel products and vehicles among the top candidates, as part of a broader push to align with U.S. trade policies and extend benefits under the U.S.-Mexico-Canada Agreement (USMCA). The Economy Ministry confirmed it is conducting consultations and case-by-case anti-dumping investigations, which could lead to additional duties, though no concrete proposal has been formalized yet. The move is part of President Claudia Sheinbaum’s strategy to bolster domestic manufacturing and ease tensions with U.S. President Donald Trump amid ongoing USMCA reviews. In January, Mexico imposed tariffs as high as 50% on roughly 1,500 product categories from countries without free trade agreements, including China, targeting vehicles, auto parts, and steel. The U.S. has since requested Mexico adopt tariffs on Chinese steel and aluminum that mirror Washington’s Section 232 duties, aiming to create a unified North American stance against Beijing. Sheinbaum has signaled openness to this request as part of the USMCA review. The tariffs are also intended to strengthen Plan Mexico, Sheinbaum’s economic blueprint featuring tax incentives and state-led investments to reduce reliance on Chinese imports and stimulate local supply chains. Industry groups, including steelmakers, textile producers, and heavy-vehicle manufacturers, have lobbied for stronger protections, citing unfair trade practices that allegedly harm domestic production and employment. Since the January tariffs took effect, imports of Chinese goods covered by the measures have plummeted, with the value of Chinese imports dropping by nearly one-third in the first five months of 2026 compared to the same period last year. The decline was most severe for Chinese light vehicles, auto parts, and footwear, all of which fell more than 40%, reflecting a significant shift in trade dynamics.