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

## China Warns Mexico Over Planned Car Tariffs

China is strongly objecting to Mexico’s plan to significantly raise tariffs on cars imported from Asia, particularly China. Here’s a breakdown of the situation:

• Mexico’s Plan: Mexico intends to increase tariffs on Asian-made cars from 20% to 50%. This move still requires Congressional approval.
• China’s Response: China’s Ministry of Commerce has issued a warning, urging Mexico to reconsider and stating they will take “necessary measures” to protect their interests. They emphasize the importance of their trade partnership and the need to avoid actions that could harm it.
• Context of USMCA: Mexico benefits from the USMCA trade agreement with the U.S. and Canada, which requires a greater percentage of a vehicle’s components to be made within the region.
• Broader Implications: Mexico’s tariff plan is part of a larger budget proposal affecting a significant amount of imports. China has previously used trade restrictions as countermeasures in response to U.S. tariffs.
• Expert Opinions: Some experts suggest that the 50% tariff is lower than those imposed by other countries. They also note that Chinese car exports in Mexico are taking market share from other Asian brands.
• Investment in Mexico: Chinese auto parts manufacturers have invested billions in Mexico, but it’s unclear how many projects have been completed.
• Market Dynamics: Despite potential tariffs, the value proposition of Chinese cars may remain attractive. Mexico is currently a top destination for Chinese car exports.

For more details, you can read the original article on CNBC: [Link to CNBC Article](insert_link_here)