Trump announces 90-day extension for tariff standoff with Mexico, as per mutual agreement between the US and Mexico.
Mexico is currently subject to several US tariffs, as announced by President Trump in 2025. The tariffs include a 50% levy on steel, aluminum, and copper products, and a 25% tariff on automobiles and auto parts imported from Mexico. Additionally, a 30% tariff on Mexican goods was set to take effect on August 1, 2025, but was suspended for 90 days starting July 31, 2025, in a bilateral agreement between the US and Mexico.
This suspension came with commitments from Mexico to eliminate all non-tariff barriers impacting US products and to negotiate a new trade agreement with the US within this period. It is important to note that the existing tariffs under the United States-Mexico-Canada Agreement (USMCA) remain in place. Exports that do not meet USMCA origin rules face a 25% tariff, while steel, aluminum, copper, autos, and parts remain at 50% and 25% tariffs respectively.
The 90-day suspension is seen as a diplomatic pause aimed at fostering negotiations. However, the high tariffs on metals and autos continue to exert pressure on Mexico’s exports and supply chains, complicating ongoing trade talks. Mexico must address both tariff barriers and non-tariff restrictions for US products while negotiating terms to potentially replace or revise USMCA provisions.
Here is a summary of the current US tariffs on Mexican imports:
| Product Category | Current US Tariff on Mexican Imports | Notes | |----------------------|----------------------------------------|------------------------------------------------------| | Steel, Aluminum, Copper | 50% | Remain in effect under existing tariffs | | Automobiles & Auto Parts| 25% | Under existing USMCA-related tariffs | | Other Mexican Goods | 30% (suspended for 90 days from Aug 1) | Suspended pending trade agreement negotiations |
The tariff structure exerts significant economic pressure on Mexico and signals the US’s leverage in negotiating trade terms. The 90-day tariff pause acts as a crucial window for both nations to reach a new agreement.
In addition, a 25% tariff will also remain on cars imported from Mexico. Canada has yet to strike a deal with the US. For aluminum, copper, and steel imported from Mexico, a tariff of 50% will continue. President Trump wrote on Truth Social that he and President Sheinbaum will continue to negotiate over the next 90 days.
Recently, President Trump announced an extension of Mexico's current tariffs for another 90 days, saving Mexico from an impending Aug. 1 deadline. The tariffs will continue at a rate of 25% for all goods as punishment for fentanyl crossing the border. Mexico has agreed to immediately terminate its Non-Tariff Trade Barriers.
Interestingly, President Trump also announced that the tariff on goods crossing the US-Canada border will increase to 35% starting Friday. This extension was announced following a phone call with Mexican President Claudia Sheinbaum. The ongoing negotiations between the US and its North American neighbours promise to shape the future of trade relations in the region.
- Despite the recent 90-day suspension of a 30% tariff on Mexican goods, a 25% tariff will still apply to all goods imported from Mexico, as announced by President Trump due to concerns about fentanyl crossing the border.
- In the ongoing negotiations between the US and Mexico, progress has been made with Mexico agreeing to immediately terminate its Non-Tariff Trade Barriers, but the high tariffs on steel, aluminum, copper, automobiles, and auto parts from Mexico remain unchanged, putting pressure on Mexico’s exports and supply chains.
