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The UK has secured an extension to arrangements that were due to expire, helping British manufacturers access lower or zero tariffs when selling their products to Mexico.
The arrangement will come into effect from 1 January 2024 and will remain in place until a new UK-Mexico Free Trade Agreement enters into force.
The deal will provide welcome certainty for UK businesses, helping them to continue avoiding high tariffs imposed by Mexico and maintain their competitive edge in the market. The announcement is particularly welcome news for the automotive and food and drink sectors, with road vehicles accounting for almost £300 million in exports to Mexico, almost 20% of all goods exported.
Mexico is the 14th largest economy in the world and second largest in Latin America, and its demand for imports is forecast to grow by 42% between 2021 and 2035 as its economy continues to grow. With a population of over 130 million people, its market is larger than France and Italy combined.