The National Chamber of the Textile Industry in Mexico (Canaintex) and the National Council of Textile Organizations of the United States (NCTO) asked the president-elect of the United States, Donald Trump, to stop and reverse the de minimis figure in trade agreements, since It is used by the Chinese companies Shein and Temu to undermine the USMCA textile industry.
“We urgently call on the incoming Trump administration to use its executive powers to close a loophole in US trade law known as de minimis, which is providing 4 million duty-free packages a day to the United States and undermining the American industry and our free trade agreement partners,” Rafael Zaga Saba, president of Canaintex, and Kim Glas, president and CEO of the NCTO, indicated in a letter.
The USMCA establishes that products of origin with a value of up to $50 will be free from paying tariffs and VAT, while the limit for duty free shipments is up to $117. Merchandise that falls within these values will be subject to a simple review.
In December 2023, Emilio Penhos, president of the National Chamber of the Clothing Industry, warned that the Shein and Temu online stores abuse the minimis to avoid paying 38,000 million pesos in taxes in Mexico.
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In mid-December, Claudia Sheimbauim’s government established the collection of taxes on packages and products purchased through Chinese online stores such as Shein and Temu to stop the entry of unrealistically cheap products.
Additionally, the government applied tariffs on textile products that are undervalued.
“The commitment of Dr. Claudia Sheinbaum and teacher Marcelo Ebrard to the economic development of the country and the promotion of fair market conditions for Mexico gives certainty to hundreds of thousands of families who are pillars of the Mexican textile industry,” said Rafael Zaga. .
The presidents of Canaintex and the NCTO recognized the increase in the rate of the General Import and Export Tax Law, and the Decree for the Promotion of the Manufacturing, Maquiladora and Export Services Industry.
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They said the government’s actions stop the illegal flow of products that for years have undermined the development of the textile sector in Mexico and the United States.
“Domestic textile and clothing manufacturers appreciate the efforts of the Mexican government to stop the flow of illegal and subsidized products into our markets that evade tariffs, taxes and tariffs, affecting our critical sectors,” the organizations noted.
They noted that the government protects the Mexican and US textile and clothing industries against countries like China, “which deliberately employ unfair trade practices such as dumping, smuggling and undervaluation of textile and clothing products, which affect the competitiveness of national producers and put “Thousands of jobs in Mexico are at risk.”
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The NCTO employs more than 501,755 people, who generate sales of 64.8 billion dollars in 2024. Capital investments for the production of textiles and clothing were 2.27 billion dollars.
The national chamber generates more than 1.2 million jobs and projects that exports will reach 10 billion dollars in 2024.
Mexico is the fourth largest exporter of textiles and the sixth largest exporter of clothing to the United States.
The United States industry has lost 25 plants in 18 months and has eliminated more than 26 thousand jobs in 2023, while Mexico has lost more than 75 thousand employees.
“We urgently need to reverse this situation, and this order will significantly help mitigate the damage caused by predatory behavior and restore the benefits of the USMCA to our countries and industries,” the document stated.
“We reiterate the importance of these actions and support the work of the Mexican government to prevent bad foreign trade practices that harm jobs, supply and value chains, as well as the positioning of the USMCA region, which is one of the most prosperous in the world. ”, he concluded.
