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Mexico prepared to retaliate if US imposes steel tariffs

U.S.-Mexico High-Level Economic Dialogue at the State Department in Washington

By Valentine Hilaire

MEXICO CITY (Reuters) -Mexico will impose tariffs on steel if its biggest trading partner, the United States, enacts such measures first, Mexican Economy Minister Raquel Buenrostro said at a news conference on Tuesday.

U.S. calls to impose tariffs on steel imports from Mexico have been politically motivated and are not good for trade, Buenrostro said.

The Mexican minister met virtually earlier this month with U.S. Trade Representative Katherine Tai, who during the call asked Mexico to address an "ongoing surge" in Mexican steel and aluminum exports to the United States and said tariffs could be reinstated.

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Mexico's steel chamber in a recent statement said steel exports to the U.S. have not seen major variations since 2020 and vowed cooperation between the neighboring nations to avoid tariffs.

The United States lifted tariffs on Mexican steel in 2019, warning they could be reinstated to protect the U.S. industry if shipments from Mexico surge beyond a certain level.

The United States has also said more transparency is needed regarding the origins of the steel and aluminum products Mexico is exporting.

"Imposing tariffs on steel is not convenient for either the United States or Mexico, because if there were tariffs, they would be impacted the most, given their larger presence in the market," Buenrostro said.

Mexico's share in the U.S. steel market stood at around 2.5% last year, while the U.S. presence in the Mexican market was about 14%, she noted.

Mexico in recent months has used tariffs to target steel imports from China, which has been accused of selling surplus steel abroad at below-market prices, a practice known as dumping.

Latin America's second largest economy is also working to tighten protocols to improve the ability to trace steel in order to avoid smuggling, according to the minister.

Buenrostro said her team is analyzing imposing tariffs on other goods, adding those potential measures will be revealed next week.

(Reporting by Valentine HilaireEditing by Drazen Jorgic and Bill Berkrot)