February 23, 2019 / 12:47 AM / 6 months ago

Mexico mulls measures to support steel, textile industries

MEXICO CITY, Feb 22 (Reuters) - Mexico’s government on Friday signaled it could adopt measures to protect its steel and textile industries as President Andres Manuel Lopez Obrador said producers had been left “defenseless” by previous administrations.

At the end of January, the government opted not to renew a 15 percent tariff on steel imports from 2015 that protected Mexico’s steel industry from rising Asian imports, especially from China. The government also allowed tariffs to come down for imports of textile and footwear products from countries with which Mexico has no trade agreements.

However, Lopez Obrador hinted at a U-turn on those moves.

“It’s being reviewed,” Lopez Obrador told a regular news conference when asked if he would take any protective measures or support fiscal incentives for the industries following the expiration of the previous safeguards.

“We don’t agree with what was done in the neo-liberal period, which saw an indiscriminate opening without limits and left domestic producers defenseless,” he said. “We’ll review this case, always thinking about protecting national industry.”

Lopez Obrador characterizes the administrations that ruled Mexico from the early 1980s onwards as “neo-liberal.”

Mexico’s steel industry has been pushing for government support since the administration of U.S. President Donald Trump slapped tariffs on imports at the end of May.

Representatives from industry drew encouragement from the president’s words on Friday.

“We greatly welcome what Mr. Lopez Obrador says because it gives us hope that tariffs could return to previous levels,” Alejandro Gomez, executive chairman of the national footwear industry association, told reporters in the state of Guanajuato.

Separately, the Mexican economy ministry said in a statement on Twitter the government was reviewing “alternative measures” to support the industries following meetings with representatives from the steel, textile and footwear sectors. (Reporting by Sharay Angulo; Editing by Leslie Adler)

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