Mexico Introduces Permits on Steel Exports As Trump Cracks Down

Mexico is setting up a pre-approval process on some steel exports to the U.S. in a bid to prevent its products from being targeted, even as President Donald Trump seeks to protect the U.S. steel industry with new quotas for Brazil.

The permits that take effect Sept. 4 would establish that Mexican steel exports haven’t been routed through Mexico from other countries, such as China, Mexico’s economy ministry said in a decree published on Friday in the nation’s official gazette.

The regulations are designed to comply with restrictions on U.S. steel imports under the so-called Section 232 national security powers, Mexico said in the decree.

President Andres Manuel Lopez Obradormet with Trump in early July in the Mexican leader’s first trip abroad. The two pledged to deepen economic integration under a new North American trade deal. During the visit, Lopez Obrador praised Trump for treating him with respect, and said that the U.S. leader had never sought to impose anything on his administration in Mexico.

On Friday, Trump cut the cap on allowable steel shipments from Brazil, citing a slump in the U.S. market. That move followed the imposition of tariffs on aluminum from Canadaearly this month as Trump tries to portray himself a defender of the U.S. economy ahead of the U.S. election in November.

Juan Carlos Baker, former Mexican undersecretary of economy for international trade, who’s now CEO and founding partner ofAnsley Consultores Internacionales, said that despite the government’s efforts, Mexican exports are likely to face scrutiny, and that Trump may seek a reason to reimpose tariffs.

“To me, the decree in Mexico’s Diario Oficial, where export permits are now required for certain products, is a signal that the Mexican government is not going to give that excuse to Trump,” Baker said.

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