Ebrard: Up to 90% of Mexican Exports to the US Could Avoid Tariffs

According to Economy Minister Marcelo Ebrard, between 85% and 90% of Mexican goods exported to the United States will be exempt from tariffs. This exemption comes after U.S. President Donald Trump decided to suspend tariffs on imports from Mexico that comply with the USMCA free trade agreement.

At a press conference held by President Claudia Sheinbaum, Ebrard shared this estimate, indicating that the suspension is in effect until April 2, following Trump's agreement with Sheinbaum after their phone call on Thursday.

Initially, the U.S. had imposed a 25% tariff on all imports from Mexico and a similar tariff on most imports from Canada. This decision was taken as a response to the claim that both countries had not done enough to prevent the entry of harmful drugs, like fentanyl, into the United States.

Details released by the White House included the following tariff structure:

• 25% tariffs on goods not adhering to USMCA rules of origin.
• 10% tariffs on certain energy products from Canada outside USMCA preferences.
• 10% tariffs on non-compliant potash from Canada and Mexico.
• No tariffs on goods qualifying for USMCA preferences.

Majority of Exports Likely Under USMCA, Says Ebrard

Ebrard explained that while some Mexican companies do not export their goods to the U.S. under the USMCA terms, they might choose to use the "most-favored nation" status instead. This choice is often made because complying with the USMCA's rules, particularly those related to the origin of goods, can be more costly.

He noted that typically, over half of Mexico's trade with the U.S. is conducted according to USMCA rules. However, many companies, currently opting for most-favored nation status, could easily comply with USMCA rules and avoid tariffs at least until the April deadline.

"We estimate that compliance with USMCA could lead to 85% to 90% of our exports to the U.S. being tariff-free," Ebrard remarked.

There are concerns that companies in the automotive sector may struggle to meet USMCA guidelines, particularly regarding the sourcing of parts. Those unable to comply would be subject to the 25% tariffs.

April Tariff Questions Loom

Ebrard raised concerns during Sheinbaum's press conference regarding the nature of tariffs that could be imposed starting April 2 when the current suspension agreement comes to an end.

He highlighted that the U.S. is expected to initiate reciprocal tariffs against its trading partners on that day. By early April, Mexico will learn about the tariffs the United States plans to implement not just on Mexican goods but also across the globe.

In the upcoming month, the Mexican government is preparing to negotiate and present arguments aimed at avoiding tariffs on its goods. Officials, including Sheinbaum, stress that imposing tariffs on Mexican exports would negatively affect the U.S. economy and increase consumer prices.

Sheinbaum has stated that since Mexico does not levy tariffs on imports from the U.S., a reciprocal relationship would mean the U.S. should not impose tariffs on Mexican products either. She expressed hope that tariffs would not be imposed when reciprocal tariffs are enacted next month.

Negotiations on Steel and Aluminum Necessary

Ebrard mentioned the planned 25% tariffs on steel and aluminum imports to the U.S., a category that includes imports from Mexico, which is set to take effect on March 12. He clarified that these tariffs are not included in the recent suspension terms regarding USMCA.

"We need to reach an agreement on steel and aluminum," Ebrard asserted, noting that the U.S. has a trade surplus with Mexico in these metals. He insisted that the tariffs are unjustified and urged ongoing discussions to resolve the situation.",

Ebrard had previously stated such tariffs were illogical given the integrated nature of the U.S., Mexican, and Canadian economies.

exports, tariffs, trade