After the recent warning from the United States to Mexico about the potential imposition of export tariffs of 25 percent on steel and 10 percent aluminum as in 2018, the Mexican Congress intends to get involved in those industries that generate a trade flow of $51.8 billion or 5.1 percent of Mexico's trade flow with the world.
“It is necessary that the head of the Ministry of Economy, Raquel Buenrostro, announce the results of the meeting that was held with the United States trade representative, Katherine Tai, regarding the accusations against Mexican steel,” said the senator of the opposition party Verónica Martínez, of the PRI.
“Serious consequences are warned if the United States government establishes measures against this sector,” the congresswoman said in a press release.
On Friday, February 16, a virtual meeting was held between Katherine Tai, United States Trade Representative (USTR) and the head of the Mexican Ministry of Economy, Raquel Buenrostro to talk about foreign trade in steel and aluminum.
After a year of negotiations, the United States government warned the Mexican government that it must take urgent measures to confront the increase in exports of said metals to the American Union from Mexico, through commercial triangulation of steel from China.
In that meeting, Tai recalled that they can reinstate the tariffs of Section 232 of the Trade Expansion Act of 1962 that were applied in 2018.
The USTR threat occurred despite the fact that in August 2023, Mexico established additional tariffs of 25 percent on steel imports for countries with which it does not have a trade agreement. The tariff is additional to the possible countervailing duties for dumping with countries such as China, India, Russia, South Korea, Turkey, Brazil, Iran, Ukraine, Taiwan, Vietnam, Indonesia, Kazakhstan. That tariff will be in effect until July 31, 2025.
Furthermore, the United States complains about Mexico's opacity in the foreign trade of these metals. An example of the above could be the lack of updated information from the Mexican government office in charge of national statistics, Inegi, which has a delay of one year in publishing the volumes of Mexican exports.
Also, there is a lack of foreign trade information by product or chapter and its origin and destination. With the information available, in 2023 Mexico exported to the world $3.6 billion from Chapter 72 (cast iron and steel), $8.4 billion from Chapter 73 (cast iron or steel manufacturers) and $2.2 billion from Chapter 76 (aluminum and its manufacturers).
Despite the mandate established in the Mexican Constitution, there is a lack of “quality, relevant, truthful and timely information, in order to contribute to national development,” as stated in Article 3 of the Inegi Law. At least on the topic of the current trade dispute.
Separately, 26 deputies from the party in power, the party created by the current president of the Republic, Morena, urged the creation of a dialogue table, although they rejected the USTR complaint.
“We call for dialogue and propose creating a bilateral working group between governments and companies, to combat unfair trade, triangulation, customs fraud and jointly explore mechanisms, actions and solutions that are appropriate, sustainable and aligned with the reality of flows. trade between Mexico and the United States,” they reported in a press release.
Although the deputies emphasized that “Mexican steel exports are not in violation of the USMCA or any trade agreement. "It is false that there is a lack of cooperation and transparency on the part of Mexico and that our country is a triangulation bridge for Chinese steel products to the United States."