Since last Thursday, the 20th, Mexico has exempted tariffs on toilet paper imports, as part of the Package Against Inflation and Scarcity (PACIC). The decision was published by the Ministry of Finance and Public Credit, in the Official Gazette of the Federation (DOF), and exempts imports from 78 tariff fractions.
An exporter of the product, with marginal imports, the country adopted the measure due to a certain degree of global shortage, caused by military conflicts in March, Russia banned foreign sales of birch wood in retaliation for sanctions imposed by the US and the European Union after Putin’s invasion of Ukraine. As a result, industry analysts project that 800,000 to 1.2 million tons of pulp will be sold on international markets.
In the country, consumer inflation at the end of the first half of 2022 was 8%, above the Bank of Mexico’s inflation target of 3% for the year, 0.6 percentage point above the 7.4% index for 2021 and 4.8 percentage points above the 3.2% inflation for 2020.
Annual inflation, which better demonstrates medium-term price pressures on the economy, remained above the inflation target for the year, at 7.5% for the first half of 2022, above the previously recorded inflation of 5 .9% in 2021.
According to the Mexican government, PACIC will favor families with lower purchasing power, as they are the ones who allocate the highest percentage of their spending to basic food products, as pointed out in the Monthly Report on the Behavior of the Economy of May this year, presented by Technical Directorate of the National Commission for the Minimum Wage (Conasami) to the Council of Representatives.
IMPORTS x EXPORTS
Between January and November 2021, Mexican toilet paper imports amounted to just US$2.6 million, of which US$1.9 million originated in the United States.
However, Mexico’s toilet paper exports reached $122.7 million in the same period. International sales were destined for Costa Rica, Guatemala, El Salvador, Honduras, Belize and the United States, which alone represents US$ 105.1 million.