Mexico | Reduction of tariffs: a good measure, with a limited anti-inflationary effect

Summary

As part of the package against inflation and famine (PACIC) implemented by the federal government to contain inflationary pressures, the removal of tariffs on various food products for one year was announced.

Key points

• Key points:
• It has been widely commented that the impact of these measures on inflation will be limited.
• Being Mexico, rightly so, a very open economy, it will be very difficult for it to insulate itself from global inflationary pressures.
• Most agricultural products are commodities, that is, goods with little or no differentiation and therefore are traded at single international prices.
• The problem of food inflation is very serious and will bring about increases in global poverty and social conflicts that can turn violent.

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