The Ministry of Economy confirms that the new tariffs will not apply to 85% of Mexican exports to the United States

«In consultations held today, it was clarified that Mexican trade that complies with the rules of origin of the T-MEC – around 85% of the volume of our exports – is exempt from the measure.» The government said on Wednesday, guaranteeing that exports that meet the T-MEC’s rules of origin, or about 85% of its sales to the US market. Would be exempt from the tariff proposal put forth by Washington as part of an investigation into forced labor. Additionally, it wouldn’t impact the products included in orders 232 (autos, steel, and aluminum),» the Ministry of Economy stated in a statement.

The explanation was provided following discussions with the Office of the United States Trade Representative (USTR) this Wednesday. The USTR had suggested the previous day that imports from Mexico and thirteen other economies be subject to an additional 10% tariff. Due to an investigation conducted under Section 301 of US trade legislation.

The government claims that the move would not have an impact on goods covered by US Section 232, including as steel, aluminum, and vehicles.

According to the USTR investigation, sixty economies—including Mexico, Canada, the United Kingdom, and the European Union. Have demonstrated inadequate implementation of policies to stop the importation of goods made in third countries using forced labor.

As a preliminary outcome, Washington suggested a 12.5% tax for the remaining 46 countries and an additional 10% tariff for Mexico and other economies under investigation.

The Ministry of Economy emphasized that the plan opens a 45-day consultation period prior to any final decision and does not anticipate immediate implementation.

T-MEC rules of origin

The government declared that it will have formal discussions with the USTR. In the upcoming weeks regarding the remaining 15% of exports that would not be covered by the T-MEC’s rules of origin. These discussions will include a round of negotiations within the framework of the regional trade agreement review, which will be led by Secretary of Economy Marcelo Ebrard.

Mexico stated that it is certain that the tariff plan, which might impact a small portion of its commerce, will be changed in light of the bilateral dialogue tables that both nations will hold in the upcoming weeks.