Potential China tariffs might negatively affect Mexican industries, according to a chamber's cautionary statement.
Mexico has announced plans to introduce duties of up to 50% on cars and other products made by China and other Asian producers, a move that could potentially harm the development of the mobility sector, particularly electric mobility, according to Gerónimo Ugarte Bedwell, Chief Economist at the brokerage house Valmex.
The proposed tariffs, which target parts and components for motorcycles, automobiles, batteries, engines, and more, have raised concerns about Mexico's competitiveness in sectors with high substitutability in China. Ugarte warns that the introduction of tariffs by Mexico could encourage China to introduce retaliatory tariffs on Mexican goods, such as copper ore.
President Claudia Sheinbaum seeks to protect Mexico's domestic industry through these proposed tariffs, but does not want any conflict with China. However, MEXCHAM, the Mexico National Chamber of the Transformation Industry, has warned that high tariffs on Chinese imports could negatively impact industrial transformation and disrupt product supply chains that are sold from Mexico.
At least six key industries could come under threat if tariffs are introduced: automotive, electronics, pharmaceuticals, chemicals, telecommunications, and clean energy. MEXCHAM has called for a reconsideration of the proposed tariffs, suggesting that Mexico should conduct a 'very clear' analysis of the country's concrete options for replacing high-tech imports in the immediate future.
The tariffs, which range from 10% to 50% on over 1,300 products, are aimed at protecting national industry. However, economists like Ugarte fear that Mexico could suffer inflationary and manufacturing cost pressures due to its dependence on Chinese inputs.
China has urged Mexico to reconsider levying higher tariffs. A spokesperson for the Chinese Commerce Ministry stated that any unilateral tariff increase by Mexico would be seen as appeasement and compromise toward unilateral bullying. The spokesperson also emphasised that China will take necessary measures to protect its own interests.
The Mexican government's proposal has been met with criticism from various sectors, including CANACINTRA, which fears that the tariffs could cancel any possibility of absorbing, consolidating, and developing technology in the Mexican market for key sectors that drive inflation control and preserve the remunerative capacity of the minimum wage in Mexico.
In the first six months of 2025, Mexico attracted US $3 billion in new foreign direct investment. Despite this, the inflation rate was 3.57% in August, raising questions about the impact of the proposed tariffs on the economy.
President Sheinbaum stressed that the proposed tariffs neither target China nor are the result of U.S. pressure. The sources for this information are Milenio, Bloomberg, and La Crónica de Hoy.
