China threatens Mexico with trade reprisals over 50% import duties

China warned Mexico on Thursday it could impose retaliatory measures after concluding a formal investigation into tariffs Mexico imposed on more than 1,400 categories of Asian goods, in a dispute that threatens to complicate Mexico City’s parallel negotiations to renew its trade agreement with the United States.China’s Ministry of Commerce (MOFCOM) said the tariffs, which range from 5 to 50 per cent on 1,463 product categories in force since January 1, restrict the entry of Chinese goods, services and investment into the Mexican market and constitute barriers to trade. Beijing said the measures affect more than US$30 billion in Chinese exports and have inflicted losses of roughly US$9.4 billion on China’s mechanical and electrical industries.“The ministry is authorised to apply the pertinent measures to firmly safeguard the interests of Chinese industries,” MOFCOM said in a statement carried by state news agency Xinhua.Mexico’s Economy Secretary Marcelo Ebrard rejected the Chinese position, saying Mexico had the right to protect its industries from what he described as unfair competition.“We put tariffs in place because we consider that there is an effort to expand the market with government support,” Ebrard said at the annual assembly of Caintra, a major industrial chamber in Monterrey.“Your exit price is lower than what it costs the other guy to open his shop. You are going to bankrupt any company.”Mexican President Claudia Sheinbaum says her government finalised the tariff measure to help promote domestic production and strengthen small businesses. Photo: EPA