Economics: The initiative to raise tariffs on 1,463 products will lead to increased costs and a loss of competitiveness in some sectors
On September 9, one day after the Economic Package was presented, the Ministry of Finance (SHCP) sent an initiative to modify the General Law on Import and Export Taxes (LIGIE). The initiative seeks to increase tariffs on 1,463 items by between 10% and up to 50% for the period from January to December 2026, in many cases setting them at the maximum level allowed by the World Trade Organization for countries with which Mexico does not have a free trade agreement.
This initiative aims to align interests with the United States and Canada ahead of the review and potential renegotiation of the USMCA next year, rather than promoting domestic industry, as the Secretary of Economy announced. In fact, besides leading to an increase in consumer prices, it will raise costs for industries that managed to increase their competitiveness by using inputs from Asia, especially China, for the production of exportable goods during the 2022-2025 period.
Regarding the last week's indicators, it was reported that the Global Indicator of Economic Activity (IGAE) fell by -1.2% YoY in July seasonally adjusted, after increasing by 0.7% in June. Consequently, it maintains an average increase of 0.3% in the first seven months of the year, matching our own projection for growth in 2025. Separately, it was reported that the Mexican Central Bank (Banxico) reduced the interest rate by 25 basis points, bringing it to 7.75%.
Now read on...
Register to sample a report