Why Mexico wants to raise tariffs as high as 50% on 1,500 Asian goods
Mexico City, in a bid to protect domestic industries, President Claudia Sheinbaum has submitted a proposal to Congress to increase import tariffs by as much as 50% on nearly 1,500 product categories from Asian countries with which Mexico has no free trade agreements.
The proposal, part of the 2026 budget process, aims to safeguard local jobs and industries that government officials say are threatened by what they describe as unfairly cheap imports, sometimes labelled “dumping”.
If approved, the measure would raise tariffs on a wide range of products, including Chinese automobiles, auto parts, textiles, steel, footwear, furniture, cosmetics, paper, and glass. The changes would affect approximately 19 sectors and 1,463 tariff fractions—different product classifications for trade purposes—impacting import volumes totalling about US$52 billion, or roughly 8.6% of Mexico’s total imports. The average tariff for these goods would jump from roughly 16.1% to 33.8%, with automobiles potentially seeing duties rise from around 20% to the WTO-allowed maximum of 50%.
The government frames the move as a way to strengthen Mexico’s internal production base, encouraging domestic manufacturing over imports, while also addressing trade imbalances and reducing dependency on foreign goods, particularly from Asian countries lacking trade agreements with Mexico. Congress approval is required for the proposal to take effect, though the ruling party, Morena and its allies currently hold a majority in both chambers, increasing the likelihood of passage.
Several Asian countries would be affected, including China, India, Indonesia, South Korea, Thailand, and Turkey. Mexico insists that the plan complies with World Trade Organisation rules, raising tariffs only “up to the maximum allowed”. In response, China criticised the proposal, calling it an unjustified trade restriction and suggesting Mexico is yielding to external pressure, implicitly from the United States. Mexican officials have denied any geopolitical motive, emphasising instead the economic rationale and the goal of industrial strengthening.
Economists and trade analysts warn that the proposal carries potential risks, including short-term inflation as higher tariffs typically raise consumer prices, the possibility of diplomatic friction with affected countries, and implications for Mexico’s trade relations with the United States, particularly given ongoing concerns about cheap imports and trade “leakage” within the North American trade ecosystem.
This story is written and edited by the Global South World team, you can contact us here.
