Trump Re-imposes Tariffs on 80 Countries, Mexico Spared Under USMCA

The Trump administration has imposed new tariffs on 80 countries, effective Friday, in a sweeping move to revive trade penalties invalidated by the Supreme Court last year. Mexico, however, secured a major exemption: most of its exports to the United States will remain tariff-free under the US-Mexico-Canada Agreement (USMCA), sparing the country from the broad-based levies hitting other nations.

New Tariffs, Old Grievances

The latest duties replace a 10% tariff that President Donald Trump had imposed in February after the Supreme Court struck down his earlier blanket tariffs. Those interim measures expired after 150 days, prompting the administration to craft a more targeted approach. The new tariffs apply to 80 countries, with rates varying based on findings from U.S. Trade Representative investigations into unfair trade practices, including forced labor. The alleged worst offenders face a 12.5% rate, while others may be subject to the base 10% levy.

Mexico's Tariff-Free Pathway

Mexican Economy Minister Marcelo Ebrard confirmed on Thursday that approximately 80% of Mexico’s exports to the U.S. will not be affected by the new 10% tariff. “Mexican products that comply with the terms of the USMCA will remain tariff-free,” Ebrard said after a meeting with U.S. Trade Representative Jamieson Greer in Mexico City. The remaining 20% of Mexican exports involve sectoral duties already in place—covering goods like steel, vehicles, and certain non-USMCA products—that were already set at 10% and thus remain unchanged. President Claudia Sheinbaum echoed this at her Friday press conference, stating, “All products we exported within the USMCA have zero tariffs, with the exception of steel, some vehicles and products exported outside the treaty. Mexico remains exactly the same as we were a week ago.”

Forced Labor Investigations Skip Mexico

The new U.S. tariffs are partly rooted in Trump administration claims that some countries have failed to curb forced labor. The USTR conducted investigations into various nations, and those deemed non-compliant now face the elevated 12.5% rate. However, Mexico is not among them. Ebrard emphasized that the forced-labor compliance requirements do not affect Mexico, a point Sheinbaum reiterated. This exemption underscores Mexico’s relatively clean trade record in the administration’s eyes, at least for now.

Potential Pitfall: 'Excess Capacity' Tariff

Despite the favorable treatment, Mexico could still face an obscure tariff provision known as the “excess capacity” levy, derived from a 1930 trade law. This measure targets countries that “put undue burdens on U.S. imports,” and its application to Mexico will likely be addressed in ongoing USMCA negotiations. The possibility adds a layer of uncertainty to an otherwise positive outcome for Mexican exporters.

Diplomatic Talks and USMCA Review

Greer’s visit to Mexico City was not solely about tariffs; he also participated in bilateral talks as part of the USMCA’s regular review. The meetings covered steel, aluminum, automobiles, economic security, labor, agriculture, and electronic payment services. Sheinbaum described the encounter with Greer as “an assessment of how far the talks have come, to learn more about what the U.S. is proposing, and to consider the timeline.” The ongoing negotiations aim to refine the trade pact that replaced NAFTA in 2020, with both sides seeking to balance mutual benefits while addressing persistent disputes.

The new U.S. tariffs represent a calibrated escalation in Trump’s trade agenda, but Mexico’s exemption—thanks to the USMCA—offers a reprieve that other nations do not enjoy. For now, Mexican exporters can breathe easier, but the specter of the excess capacity tariff and the broader review of the USMCA mean that trade stability remains provisional. As negotiations continue, the outcome will shape the future economic relationship between the two neighbors, with implications for supply chains and regional commerce.