Mexico begins reducing tariffs on footwear imports from Vietnam
18/01/2019
This trade deal came about following the collapse of the TPP agreement. It was signed at the beginning of March by 11 of the countries from the original deal. The exception was the US, whose withdrawal from TPP caused its initial collapse. Since then, it has been ratified by seven countries – Mexico, Japan, Singapore, New Zealand, Canada, Australia and Vietnam.
The Mexican footwear industry has in the past expressed its concerns about the deal, fearing that domestic manufacturing will be damaged by increased imports from Asia.
As of January 14, Mexico has begun the gradual reduction of tariffs on shoe imports from Vietnam. The current tariff is 27.1%, but this will be reduced to 0% by 2031 under the terms of the agreement.
A report in Mexican daily newspaper, el Economista, has forecast that Vietnam will soon overtake China as the largest supplier of footwear to Mexico. It cited figures for January-October 2018, which showed that imports of footwear from China, which are subject to tariffs of 30%, were worth $343 million. Those from Vietnam were worth $299 million.
It went on to explain that imports of footwear from Vietnam increased by an average of 14% per year between 2013 and 2017. During this period, imports from China dropped by an average of 3% per year. Should these trends continue, imports from Vietnam would outweigh those from China by the end of 2019.
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