Mexico Wins Tariff Delay, Faces Reform Pressure

The United States has granted Mexico a 90-day extension before implementing 30% tariffs on certain imports, contingent upon Mexico’s commitment to eliminate non-tariff trade barriers, according to recent statements by trade officials and experts.

The agreement, reached between US President Donald Trump and Mexican President-elect Claudia Sheinbaum, delays broader tariff actions but upholds several existing duties. These include a 25% tariff on goods linked to fentanyl and unauthorized migration, 25% on automobiles, and 50% on steel, aluminum, and copper. A 17.09% countervailing duty on Mexican tomatoes also remains in effect.

As part of the deal, Mexico committed to addressing longstanding non-tariff obstacles affecting US trade, many of which were outlined in the US Trade Representative’s (USTR) report on trade barriers. These include regulatory delays in the pharmaceutical and medical device sectors, bans on glyphosate, and preferential treatment for state-owned energy firms.

Kenneth Smith Ramos, Mexico’s former chief technical negotiator for the USMCA, noted it remains unclear whether the government’s efforts will be limited to the most frequently cited issues or extend to broader reforms. Jorge Molina, former NAFTA environmental chapter negotiator, pointed out that the list of non-tariff barriers identified by the USTR is extensive.

Among the concerns are permitting delays by COFEPRIS for pesticides, pharmaceuticals, and medical devices. The USTR also cited insufficient justification for the bans on genetically modified cotton and glyphosate, as well as weak enforcement against piracy and smuggling.

Energy sector restrictions were also flagged. Mexico’s policy of favoring state-owned companies PEMEX and CFE over private foreign investors is considered a key barrier. Other issues include state control of lithium reserves and restrictions on foreign investment in agriculture, livestock, forestry, and transport infrastructure.

In telecommunications, the USTR raised concerns about monopolistic practices by dominant players. Additional barriers include a ban on US potato imports and pending restrictions on the cultivation of genetically modified corn, despite Mexico recently lifting the ban on its import and commercialization.

While Mexican business groups welcomed the temporary suspension of new tariffs, they warned that addressing non-tariff barriers will require substantial regulatory, and possibly constitutional, reforms.