What: Mexico implements significant tariff increases of up to 35% on finished clothing and 15% on textile merchandise through April 2026, exempting free trade agreement partners, to protect domestic textile jobs and combat unfair competition.

Why it is important: The policy reflects growing tensions between protecting domestic industries and maintaining international trade relationships, particularly as countries seek to balance economic sovereignty with global market integration.

Mexico announced temporary tariff increases targeting the textile industry, with rates rising to 35% for finished clothing products and 15% for textile merchandise until April 2026. The measures exempt countries with existing free trade agreements, such as the US and Canada. This policy aims to address the significant decline in textile industry employment, with 79,000 jobs lost in recent years. While officials emphasize that the policy is not directed at any specific country, it comes amid broader efforts to strengthen the North American trade bloc and concerns about cheap imports using Mexico as a backdoor to the US market. The government has also expanded restrictions on textile imports and implemented raids to combat illegal merchandise, particularly from China.

IADS Notes: While targeting low-cost imports, this move aligns with efforts to strengthen North American trade integration. The policy comes amid growing concerns about Chinese e-commerce platforms, though officials emphasize the measures apply to all non-free trade agreement countries rather than targeting specific nations.

Mexico announces steep tax increase on textile imports