Mexico's Tariffs Target Asian Imports to Boost Domestic Production

Mexico's lower house approved significant tariffs on imports from China and several Asian countries to bolster domestic production and address trade imbalances. The proposal, yet to receive Senate approval, faces opposition from China and local businesses but aims to generate additional revenue for Mexico.

Mexico's lower house passed a bill early Wednesday to impose tariffs up to 50% on imports from China and other Asian nations, seeking to encourage domestic production and rectify trade discrepancies. The bill, approved by 281 votes, still requires Senate approval amidst criticism from China and local business factions.

The tariffs, primarily reaching 35%, will be in effect until 2026, targeting goods such as autos, textiles, and plastics from countries without Mexican trade agreements, including India and South Korea. President Claudia Sheinbaum's administration claims the bill aims to bolster local production and counterbalance trade deficits with China.

The private sector and analysts suggest the move aligns with efforts to appease the U.S. prior to the upcoming USMCA review and potentially raise $3.76 billion in revenue, aiding Mexico's fiscal deficit. Despite concerns from the automotive sector about essential import access, the government insists inflation will remain unaffected.

(With inputs from agencies.)