In a move not inspired by Trump’s threats, Mexico has raised tariffs on several textile-related products, including denim, polyester fibers, and finished clothing. The new tariffs, announced by Mexico’s economy minister Marcelo Ebrard, will increase by 15% on 17 categories of textile merchandise and up to 35% on 138 types of finished garments such as knitwear, jackets, and lingerie. This decision, however, will not affect imports from the United States due to exemptions under the United States-Mexico-Canada Agreement (USMCA).

Ebrard emphasized that the tariff hikes are not targeted at any specific country, but rather at strengthening Mexico’s textile industry, which has been facing increasing pressure due to unfair competition and the erosion of domestic production. According to the Mexican government, the industry has suffered a 4.8% annual decline in its gross domestic product (GDP), and around 79,000 jobs have been lost in recent years due to foreign competition.

The tariff hikes will remain in place until April 22, 2025. In addition to increasing tariffs, the government is also imposing restrictions on imports through the IMMEX program, a duty-deferral scheme that has been allegedly abused to bring in raw materials for products that are sold domestically without paying proper taxes. This misuse of the program has reportedly led to the loss of jobs and unfair market practices.

Ebrard stated that the government’s goal is to increase the national content in goods consumed in Mexico. "The more Mexican content there is, the more jobs there will be in Mexico promoting fair market conditions," he explained. The government believes this will help bolster Mexico’s industrial development and protect jobs in the country’s textile sector.

While the tariff increases are aimed at boosting domestic production, Mexico has also imposed specific tariffs on goods from countries it does not have trade agreements with, such as China. These tariffs, particularly on aluminium, plastics, and steel, have been seen as a response to concerns from the U.S. about China using Mexico as a conduit for cheaper goods entering the North American market.

In a related context, President Claudia Sheinbaum has warned the United States that Mexico would retaliate against any further tariff increases imposed by the U.S. with its own set of taxes. She has indicated that such measures could undermine the USMCA, a trade agreement crucial for the economies of the three countries involved.

The tariff increases are expected to help Mexico’s textile industry rebound and reduce job losses, but they also highlight ongoing challenges in balancing domestic protection with international trade agreements.