Mexican President Sheinbaum said on October 10 that the Mexican Congress will suspend the proposal to impose tariffs on nearly 1500 products from China and other Asian countries; at the same time, Mexico will hold consultations with China and other countries on tariff issues and revise the previous tariff proposal issued by Mexico.
Mexico's suspension of the tax increase proposal and its shift toward consultation essentially represents a rational retreat from its unilateral trade protectionist attempt under real pressure. This change was directly driven by China's "rule-based countermeasures" such as anti-dumping investigations and trade barrier investigations, which accurately targeted its weaknesses in pecan exports and automotive parts supply chains. It is also due to strong opposition from domestic industries in Mexico - 43% of key components used by local car manufacturers depend on imports from China, and the tariff would directly increase costs by 28%, possibly even scaring away foreign investment plans for factory construction.
More intriguing is the geopolitical entanglements behind the proposal. Previously, after a high-ranking U.S. official visited Mexico, it suddenly launched the tax plan, which was interpreted by the outside world as a gesture to the United States to respond to pressure, while this suspension reveals its dilemma in "taking sides" between China and the United States: it needs to consider U.S. demands, but cannot bear the economic cost of decoupling from China. From a "strong proposal" to "active consultation", this reversal proves the high complementarity of Sino-Mexican trade, and shows that in the current context of deep integration of global supply chains, unilateral tariffs have long been an ineffective option that harms others without benefiting oneself.
Original: www.toutiao.com/article/1845676094286856/
Statement: The article represents the views of the author himself.