Legal and Economic ReasonsImpact on China - Mexico TradeGlobal Supply Chain and China - US Trade RelationsMexicos legal basis includes the Political Constitution of the United Mexican States and the International Covenant on Economic,Social and Cultural Rights.In addition,Mexico also emphasizes its rights within the framework of the World Trade Organization,that is,adjusting import tariffs as long as they do not exceed the bound tariff range.It took effect on August 16,2023 and will be valid until July 31,2025..(Note 1: For imported goods classified under tariff headings 7210.70.02 and 7212.40.04,a 10% tariff rate applies from the effective date of this decree until December 31,2023; a 25% tariff rate applies from January 1,2024,to July 31,2025.) This tariff adjustment aims to protect Mexico’s domestic industries,especially the automotive manufacturing industry.

Impact of tariff adjustment: Although Mexico has adjusted the tariffs of 392 tax codes,according to customs data,the five major categories of products that are truly affected are mainly steel and steel products,plastics and rubber,transportation equipment and parts,textiles,and miscellaneous furniture.

Mexicos tariff adjustment will have a relatively large impact on Chinese enterprises exporting to Mexico.However,considering the close connection of the global automotive industry chain and the depth of trade relations between China and Mexico,both sides should actively communicate and seek common solutions to reduce trade frictions and achieve a win - win situation.

The original text of this decree in Mexico: https://www.dof.gob.mx/nota | detalle.php?codigo=5698661&fecha=15/08/2023#gsc.tab=0

Impact on the automotive industry: Auto parts are one of the main products imported by Mexico from China.Mexicos automotive manufacturing industrys dependence on China is also steadily increasing.

Growth in Trade Volume: China’s merchandise exports to Mexico have shown significant growth in recent years,particularly in the automotive manufacturing sector.Mexico also serves as a crucial link in the United States’ "nearshoring" supply chain strategy across North and Latin America.

Impact of Tariff Adjustments: Although Mexico has adjusted the tariffs of 392 tariff numbers,according to customs data,the five major categories of products that are truly affected are mainly steel and steel products,plastics and rubbers,transportation equipment and parts,textiles,and miscellaneous furniture.

Impact on the Automotive Industry: Automotive parts are one of the main products imported by Mexico from China.Mexicos automotive manufacturing industrys dependence on China is also steadily increasing.

The United States layout of the friend - shore supply chain through the United States - Mexico - Canada Agreement to counter Chinas influence is beginning to show results.Although Mexicos increase in tariffs is beneficial to its trade relations with the United States,it may also have an impact on China - Mexico trade relations.

The United States has begun to see initial success in countering China’s influence by establishing a "friend-shoring" supply chain through the USMCA.While Mexico’s increased tariffs may benefit its trade relations with the U.S.they could also impact Sino-Mexican trade ties.

Mexicos tariff adjustment will have a relatively large impact on Chinese enterprises exporting to Mexico.However,considering the close connection of the global automotive industry chain and the depth of trade relations between China and Mexico,both sides should actively communicate and seek common solutions to reduce trade frictions and achieve a win - win situation.

Original text of the Mexican decree: https://www.dof.gob.mx/nota_detalle.php?codigo=5698661&fecha=15/08/2023#gsc.tab=0