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    Mexico|Mexico to face relatively lower protectionism, potentially revitalizing nearshoring

    Published on Thursday, April 3, 2025 | Updated on Thursday, April 3, 2025

    Mexico|Mexico to face relatively lower protectionism, potentially revitalizing nearshoring

    Summary

    On April 2, 2025, the White House issued an executive order introducing reciprocal tariffs aimed at regulating U.S. trade and reducing the trade deficit. A baseline 10% tariff will take effect on April 5, while country-specific reciprocal tariffs will be implemented starting April 9.

    Key points

    • Key points:
    • The U.S. is imposing tariffs on imports from nearly every country, with a particular emphasis on Southeast Asian nations. Mexico and Canada are not included in the list of reciprocal tariff targets.
    • Except for beer exports, Mexico’s trade position remains unchanged compared to prior to the announcement. Tariffs on automobiles, steel, and aluminum remain in place.
    • All of these tariffs are in violation of the USMCA agreement, therefore we expect them to be potentially reversed in the short term.
    • This places Mexico in a relatively favorable position compared to other trade competitors—particularly China—potentially jumpstarting nearshoring activity and enhancing U.S.-Mexico economic integration over the medium term.
    • The policy may escalate into a trade war and dampen global and U.S. economic growth, thereby negatively affecting Mexico’s growth in the short run.

    Geographies

    Authors

    Diego López BBVA Research - Senior Economist
    Alfonso Gurza BBVA Research - Principal Economist
    Carlos Serrano BBVA Research - Chief Economist
    Samuel Vázquez BBVA Research - Principal Economist

    Documents and files

    Report (PDF)

    Mexico to face relatively lower protectionism, potentially revitalizing nearshoring

    English - April 3, 2025

    Report (PDF)

    Mexico to face relatively lower protectionism, potentially revitalizing nearshoring

    Spanish - April 3, 2025

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