Officials in Washington and Ottawa have voiced concerns that Mexico serves as a backdoor for Chinese products.
The Mexican government is considering new tariffs on countries without trade agreements with Mexico, including China, according to President Claudia Sheinbaum.
The proposed tariffs are part of a broader national strategy—known as Plan Mexico—designed to accelerate the country’s industrial development and enhance global competitiveness.
“We’re considering, as part of the Plan Mexico that we put forward when we started our government, imposing tariffs on countries with which we don’t have a trade deal, including China,” Sheinbaum told reporters at a regular briefing on Sept. 4.
She added that details about the new levies would be revealed in due course, without giving a timeline or specifying which sectors might be impacted.
The Sheinbaum administration in January unveiled Plan Mexico, which also aims to reduce the country’s reliance on cheap imports from China.
By boosting the country’s manufacturing capabilities, the initiative aims to ensure that half of domestic supply and consumption will be “Made in Mexico.” The plan focuses on developing key sectors such as automotive, aerospace, electronics, and pharmaceuticals. It will also support Mexican steelmakers, who have long complained about their Chinese rivals selling products at below-market prices, a practice known as dumping.
Bilateral trade between Mexico and China has surged dramatically over the past decade. Still, the growth is largely one-sided, with China shipping more goods to Mexico than it imports. Mexico’s official data show that the trade deficit with China reached approximately $120 billion in 2024.
Meanwhile, many Chinese companies have relocated their production facilities to Mexico in recent years due to the initial tariff hikes imposed by the first Trump administration in 2018 over China’s unfair trade practices. Aside from saving on shipping costs, the move effectively allowed Chinese products to be labeled as “Made in Mexico,” thus bypassing the levies that the United States imposed on China.
Officials and industry representatives in Washington have accused China of taking advantage of Mexico’s free trade agreement with the United States and Canada, known as USMCA. Canadian officials have also expressed concerns that Mexico has been used as a backdoor for Chinese products to enter the free trade zone.
The USMCA is set to undergo a formal review next year.
According to U.S. Commerce Secretary Howard Lutnick, U.S. President Donald Trump is likely to renegotiate the trade pact, as part of his administration’s efforts to protect American workers.
Upon returning to office, Trump imposed a 25 percent tariff on all imports from Mexico, citing concerns surrounding fentanyl, but the USMCA shields most goods from extra levies.
On July 31, Trump announced an extension of existing tariffs on Mexican goods, saying that he would not raise tariffs for another 90 days to allow time to negotiate a broader trade deal.
“The complexities of a Deal with Mexico are somewhat different than other Nations because of both the problems, and assets, of the Border,” Trump said in a Truth Social post.
