Amazon's Chinese Rivals Temu And Shein Got Hit Hard By Tariffs In This Country, Is It A Sign Of Things To Come Under Trump?

Mexican authorities have imposed a 19% tariff on goods imported via courier from China, affecting popular online retailers Shein and PDD Holdings Inc.'s (NASDAQ:PDD) Temu, rivals to Amazon.com, Inc. (NASDAQ:AMZN).

What Happened: This tariff, effective Wednesday, targets countries without relevant international treaties with Mexico, reported Nikkei Asia.

For imports from the U.S. and Canada, which are part of the U.S.-Mexico-Canada Agreement or USMCA, a 17% tariff will apply to goods priced between $50 and $117.

Previously, such small package imports were not subject to tariffs, according to Mexico’s Tax Administration Service.

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With inflation in Mexico above 4%, Chinese retailers have gained traction by offering low-cost products, partly due to reduced shipping and handling expenses.

Temu and Shein have expanded by selling Chinese-made items in markets with higher prices, leveraging de minimis exemptions that waive tariffs for packages below certain values, the report noted.

Why It Matters: The new tariff may signal a message to President-elect Donald Trump, who has criticized Mexico’s openness to Chinese imports.

Following Trump’s election, Mexico, under President Claudia Sheinbaum, has taken stricter measures against Chinese goods, including raids on suspected illegal imports.

Last year, Trump announced plans to impose a 25% tariff on all products from Mexico and Canada, citing concerns over border security and illegal immigration. He also plans to increase tariffs on Chinese imports by 10% to address the flow of fentanyl into the U.S.

Economists have warned that Trump’s proposed tariffs could lead to higher costs for American households, particularly on essential items like groceries, housing, and cars.

Photo via Shutterstock

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.