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    China warns Mexico to ‘think twice’ before raising tariffs, threatens countermeasures

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    By Evelyn Cheng

    Copyright cnbc

    China warns Mexico to 'think twice' before raising tariffs, threatens countermeasures

    BEIJING — China’s Ministry of Commerce has warned Mexico of countermeasures as the country plans to hike tariffs on Asia-made cars to 50%.

    We “hope Mexico will be extremely cautious, and think twice before acting,” the ministry said in a statement late Thursday, translated by CNBC.

    “China and Mexico are mutually important trade partners,” the ministry said. “We are not willing to see both sides’ economic cooperation affected by this situation.”

    Mexico’s Secretary of Economy Marcelo Ebrard told reporters Wednesday that the country planned to raise tariffs on vehicles coming from Asia, particularly China, to 50% from the current 20%. The increased duties still need Congressional approval, and the tariffs would take effect 30 days later, he said.

    “China will take necessary measures … to resolutely safeguard its legitimate rights and interests,” China’s statement read.

    In the ongoing trade tensions with the U.S., China’s countermeasures have included restrictions on exports of minerals critical to the production of cars and other advanced technology. Chinese companies have come to dominate the supply chain for many of those minerals.

    Sitting on the southern border of the U.S., Mexico benefits from the United States-Mexico-Canada Agreement (USMCA) for tariff-free trade among the countries. But USMCA, which took effect in 2020, requires a far greater portion of a vehicle to be made in the region than the North American Free Trade Agreement agreement it replaced.

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