Mexico Increases Tariffs on Steel and Aluminum Products
On August 15, 2023, the President of Mexico signed a decree raising MFN tariffs on a wide range of imported products from the steel and light chemicals industries effective August 16. This trade policy measure of the Mexican side has many economic, commercial and political effects, which not only affect Mexico's own economy, industry and importers, but also inevitably cause changes in the policy environment for exporters and investors in countries that have concluded free trade agreements (FTA) with Mexico.
Regarding the products with anti-dumping duties listed in the decree, stainless steel from China and Taiwan; cold-rolled plates from China and South Korea; Imports such as coated flat steel from China and Taiwan, as well as seamless steel pipes from South Korea, India and Ukraine, will all be affected by this tariff increase. The decree will affect trade relations and the movement of goods between Mexico and its non-FTA trading partners, with the most affected countries and regions including Brazil, China, Taiwan, South Korea and India. However, countries with which Mexico has a free trade agreement (FTA) are not affected by this decree. Since the tariff increase was raised without warning and the official language of Mexico's announcement is Spanish, Chinese companies that use Mexico as an export market and transfer investment destination country will be affected considerably.
According to customs data screening, the export value of the 392 tariff lines listed in the Mexican decree is about 6.23 billion US dollars.Among them, the import tariff rate increase is divided into five levels: 5%, 10%, 15%, 20% and 25%, but the substantial impact is concentrated in the "windshield and other body accessories under 8708" (10%), "textiles" (15%) and "steel, copper and aluminum base metals, rubber, chemical products, paper, ceramic products, glass, electrical materials, musical instruments and furniture, etc." (25%).The 392 tariff codes involve a total of 13 categories of China's customs tariff categories, and the most affected are "steel and steel products", "plastics and rubber", "transportation equipment and parts", "textile" and "furniture miscellaneous".
