On August 15, 2023, the President of Mexico signed a decree that increases the Most Favored Nation (MFN) tariffs on various imported products, including steel, aluminum, bamboo products, rubber, chemical products, oil, soap, paper, cardboard, ceramic products, glass, electrical equipment, musical instruments, and furniture. This decree applies to 392 tariff items and raises the import tariffs on almost all of these products to 25%, with certain textiles subject to a 15% tariff. The modified import tariff rates came into effect on August 16, 2023 and will end on July 31, 2025.
The tariff increase will affect imports of stainless steel from China and China's Taiwan region, cold-rolled plates from China and South Korea, coated flat steel from China and China's Taiwan region, and seamless steel pipes from South Korea, India, and Ukraine – all of which are listed as products subject to anti-dumping duties in the decree.
This decree will impact Mexico's trade relations and the flow of goods with its non-free trade agreement partners, with the most affected countries and regions including Brazil, China, China's Taiwan region, South Korea, and India. However, countries with a Free Trade Agreement (FTA) with Mexico will not be affected by this decree.
The sudden increase in tariffs, coupled with the official announcement in Spanish, will have a significant impact on Chinese companies exporting to Mexico or considering it as an investment destination.
According to this decree, the increased import tariff rates are divided into five tiers: 5%, 10%, 15%, 20%, and 25%. However, the substantial impacts are concentrated in product categories such as "windshields and other vehicle body accessories" (10%), "textiles" (15%), and "steel, copper-aluminum base metals, rubber, chemical products, paper, ceramic products, glass, electrical materials, musical instruments, and furniture" (25%).
The Mexican Ministry of Economy stated in the Official Gazette (DOF) that the implementation of this policy aims to promote stable development of the Mexican industry and maintain global market balance.
At the same time, the tariff adjustment in Mexico targets import tariffs rather than additional taxes, which can be imposed in parallel with anti-dumping, anti-subsidy, and safeguard measures that are already in place. Therefore, products currently under Mexican anti-dumping investigations or subject to anti-dumping duties will face further taxation pressure.
Currently, the Mexican Ministry of Economy is conducting anti-dumping investigations on imported steel balls and tires from China, as well as anti-subsidy sunset and administrative reviews on seamless steel pipes from countries like South Korea. All of the mentioned products are included in the scope of the increased tariffs. In addition, stainless steel and coated flat steel produced in China (including Taiwan), cold-rolled sheets produced in China and South Korea, and seamless steel pipes produced in South Korea, India, and Ukraine will also be affected by this tariff adjustment.
Post time: Aug-28-2023