China warns Mexico to ‘think twice’ before raising tariffs, threatens countermeasures

## China Warns Mexico Over Planned Car Tariffs

China is expressing strong concern over Mexico’s plan to significantly increase tariffs on cars imported from Asia, particularly China. This move could escalate trade tensions between the two nations. Here’s a breakdown:

• Mexico’s Plan: Mexico intends to raise tariffs on Asian-made cars from 20% to 50%. This is part of a broader budget proposal impacting $52 billion in imports.
• China’s Response: China’s Ministry of Commerce has warned Mexico to reconsider, stating they are “not willing to see both sides’ economic cooperation affected.” They also vowed to “take necessary measures” to protect their interests.
• Context of USMCA: Mexico benefits from the USMCA trade agreement, which requires a greater portion of a vehicle to be made in the region.
• Industry Perspective: Experts note that the 50% tariff is lower than those imposed by Russia. China’s investments in Mexico’s auto industry have been significant, with numerous projects announced.
• Market Impact: Chinese cars have been gaining market share in Mexico, often at the expense of other Asian brands. Despite potential tariffs, the value proposition of Chinese cars may remain strong.

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