On March 6, 2019, during a meeting of the Foreign Trade Commission of the Mexican Senate, Luz Maria de la Mora-Sanchez, Foreign Trade Undersecretary of Mexico’s Ministry of Economy, announced that the Mexican government is planning to include additional items on its list of U.S. products subject to retaliatory measures, which were originally imposed on June 5, 2018, in response to the U.S. government’s imposition of Section 232 tariffs on certain steel and aluminum imports into the United States (see Trump and Trade Update of June 1, 2018). This additional list of U.S. goods may be finalized by April 2019. On June 5, 2018, the Mexican government published its “Decree modifying Mexico’s Import and Export Tariff, the Decree that establishes the applicable Duty Rate for goods originating in North America and the Sector Promotion Program Decree” (Decree) in the Federal Official Gazette, imposing retaliatory measures with rates ranging from 7 to 25 percent ad valorem on the imports of several U.S. goods as a response to U.S. tariffs imposed on imports of Mexican steel and aluminum products of 25 and 10 percent, respectively. This additional list has been prepared in large part to address the Trump administration’s continuation of these Section 232 tariffs, which both Mexico and Canada expected to be terminated upon the successful conclusion of negotiations last fall among the United States, Mexico and Canada to revise and update the new free trade agreement replacing the NAFTA.
According to the undersecretary, Mexican steel and aluminum exports do not pose a threat to U.S. national security under its Section 232 law, and these U.S. measures were imposed in violation of World Trade Organization rules and harm both regional integration and the development of several North American supply chains. Although Mexican government efforts are focused on the elimination of the Section 232 tariffs on Mexican steel and aluminum and Mexico’s corresponding retaliatory measures, the government of President Andrés Manuel López Obrador is reviewing the list of 71 HTS codes (covering U.S. imports worth approximately $3 billion) currently subject to retaliatory tariffs in order to include new items that could be subject to a 7 to 25 percent ad valorem duty.