Trump establishes a 90-day bargaining span with Mexico, maintaining 25% customs duties during the period.
The United States and Mexico have entered a 90-day negotiating period over trade, as announced by President Donald Trump and Mexican President Claudia Sheinbaum on August 1, 2025. During this period, certain tariffs have been maintained, with key details including a 25% tariff on automobiles imported from Mexico, a 25% tariff on fentanyl imports, and a 50% tariff on steel, aluminum, and copper imports from Mexico.
These tariffs are part of a broader context aimed at addressing illicit drug flows and border security. The U.S. has implemented these tariffs as part of a policy to "put America first" by reducing illegal drugs crossing the northern border.
Mexico has also agreed to immediately terminate its non-tariff trade barriers, which were numerous. The goal of these negotiations is to sign a new trade deal either within the 90-day extension period or shortly thereafter.
However, no specific new tariff rates or permanent changes have been reported yet, as these developments are part of ongoing negotiations and existing tariffs remain in place for the moment.
In other trade-related news, the EU is waiting to complete a crucial document outlining the framework to tax imported autos and other goods from the 27-member state bloc. Switzerland and Norway are also uncertain about their trade status with the United States, particularly regarding wine and spirits.
President Trump had previously threatened 30% tariffs on goods from Mexico, but these have not been implemented as part of the current negotiations. The U.S. ran a trade imbalance with Mexico of $171.5 billion in 2020, an increase from $63.3 billion in 2016.
Trump has made it a goal to close the trade gap with Mexico. In addition to the negotiations with Mexico, Trump has reached deals with South Korea, the European Union, Japan, Indonesia, and the Philippines.
Mexican leader Claudia Sheinbaum said that Mexico can now stave off the threatened tariffs for the next three months. The commerce secretary, Howard Lutnick, announced agreements with Cambodia and Thailand.
Trump and Sheinbaum had a "very successful" phone conversation, and a deal with the EU was announced on Sunday, although the document is not legally binding at this time.
Despite these ongoing negotiations, the 25% tariff rates on goods from Mexico remain in place during the negotiating period. The finalized trade agreement with revised terms or timelines beyond this extension has not been published as of early August 2025.
- The ongoing negotiations between the United States and Mexico over trade involve policies and legislation, as they aim to revise trade agreements, reduce trade imbalances, and impose tariffs on certain goods import from Mexico.
- The prospect of political changes in trade relations is evident in the recent developments, with the U.S. implementing tariffs on imported autos, fentanyl, steel, aluminum, and copper from Mexico, while the EU is waiting to complete a document outlining the framework for taxing imported goods.
