Mexico’s Senate has approved a plan to raise tariffs—some as high as 50%—on imports from China and several Asian nations beginning in 2026, a move aimed at shielding domestic industries and boosting government income.

The new duties will apply to products such as vehicles, auto parts, textiles, apparel, plastics, and steel from countries that lack trade agreements with Mexico, including China, India, South Korea, Thailand, and Indonesia. Most affected items will face tariffs of up to 35%.

The legislation, which passed with 76 votes in favour, is a toned-down version of a tougher proposal that stalled earlier, reducing or adjusting tariffs on about two-thirds of the 1,400 product lines originally targeted.

China strongly criticized the decision, calling it protectionist and warning it could harm bilateral trade.

Analysts suggest the tariff hike also reflects Mexico’s effort to remain aligned with U.S. interests ahead of the next USMCA review, while generating an estimated $3.76 billion to help address Mexico’s fiscal deficit.

Supporters say the measure will protect vulnerable industries, safeguard jobs, and strengthen Mexico’s role in global supply chains. Critics argue the higher duties will raise consumer prices and question how the additional revenue will be used.

The move also comes amid growing U.S. pressure on Latin American countries to scale back economic ties with China.