Mexico to renew tariffs on steel, textiles, and shoes

Mexico’s economy ministry

announced on Monday it had reached a preliminary agreement to renew 15 percent steel tariffs over six months with countries that do not currently have free trade agreements with Mexico.

The tariff was established in 2015 as a means to protect Mexico's domestic steel producers against growing Asian imports . Since then, the protectionist measure had been re-authorized every six months.

The tariff expired in January , prompting speculation that Mexico's new government might not re-authorize it.

Ernesto Acevedo, the economy ministry's deputy minister

for industry and trade, said the tariff will apply to the same 186 products that have previously been renewed.

Last year, the U.S. government imposed tariffs on foreign exporters of steel and aluminum, including Mexico, citing national security concerns. The tariffs were widely denounced as unfair by Mexican officials.

The U.S. steel tariff was set at 25 percent , while a separate aluminum tariff was set at 15 percent.

Acevedo said the Mexican government will continue to insist that the United States exclude Mexican firms from the metals tariffs, which took effect last June.

He added the government will also set between a 25 and 30 percent tariff on textiles and shoes from countries that do not have free trade deals with Mexico , a measure that also lapsed in January .

Until last month, said tariffs were applied on goods from countries that did not have free trade agreements with Mexico, as well as countries whose agreements with Mexico were not renewed by the Ministry of Economy (SE) .

According to official sources, President Andrés Manuel López Obrador has made it clear that he wished to renew the tariffs.

Last Friday, during a morning press conference, the statesman said: “The subject of tariffs is currently being reviewed. Though we have not yet determined our final position, we need to support the development of our national industry, as well as our domestic market and the textile, footwear, and steel sectors. We wish to break apart from the neoliberal period, during which there was an indiscriminate opening to foreign trade that left domestic producers defenseless.”

Later on, the deputy minister Ernesto Acevedo received representatives of the National Chamber of the Iron and Steel Industry (CANACERO) and the chairman of the Textile Industry National Chamber (CANAINTEX), José Cohen .

According to the Ministry of Economy, the meeting was aimed at “reviewing alternatives to support the national industry,” and resuming tariffs that had been in place until January 31, 2019 .

The executive president of the Chamber of the Footwear Industry of the State of Guanajuato (CICEG) , Alejandro Gómez, was in favor of López Obrador’s initiative to resume the tariffs, since a reduction in customs duties would likely lead to an increase of imports from Asian producers , causing enormous damage to the footwear industry.

The U.S. has not yet lifted its 25% tariffs on Mexico’s steel industry

dm