Mexico’s E-Commerce Market Poised for Growth Following Trade Agreement
MEXICO CITY (Reuters) – The nascent e-commerce sector in Mexico stands to benefit from a newly minted trade accord with the Trump administration, poised to significantly enhance the tax-exempt value of goods imported from the United States, as indicated by industry experts and online retail stakeholders.
On Monday, Mexico and the United States finalized a bilateral agreement to reformulate the North American Free Trade Agreement (NAFTA).
Negotiations with Canada, the third participant in the original 1994 pact, are still in progress and may influence the arrangement.
The agreement will double Mexico’s minimum duty-free shipment threshold, commonly referred to as the de minimis value, from $50 to $100.
This adjustment is anticipated to benefit both logistics providers and online businesses, including giants such as Amazon.com Inc.
“This is a significant advancement for us as leaders in the digital landscape,” stated Enrique Culebro, head of Mexico’s internet association, which represents notable companies like Amazon, Wal-Mart de Mexico, and various online services.
“Our optimism is substantial regarding the implications for the country, particularly for the digital sector,” he added.
According to Euromonitor International, the online retail market in Mexico, the second-largest economy in Latin America, was projected to reach approximately $7 billion in 2018. Yet, this figure constitutes merely a modest portion of overall retail sales.
Prior to the agreement, the firm had forecasted that the market could expand to $14 billion by 2022.
While the $100 threshold falls short of the initial $800 target proposed by the United States during President Donald Trump’s broader initiative to revise NAFTA, it will facilitate a wider selection of products for Mexican consumers via platforms like Amazon.
This shift promises to boost sales of U.S. specialty items priced under $100, remarked Carlos Hermosillo, a retail analyst with the Mexican brokerage Actinver.
“This is likely to enhance access to the global marketplace,” he noted.
E-commerce titan eBay Inc expressed approval of the agreement.
Mike Dabbs, eBay’s senior director of government relations for the Americas, stated, “Reducing trade barriers is essential for expanding access to a variety of goods for buyers worldwide.”
MercadoLibre, a prominent e-commerce platform, released a statement expressing anticipation for the final agreement, asserting that the revised threshold could assist smaller enterprises in entering the digital commerce arena.
“We are hopeful that these new regulations will empower Mexican entrepreneurs to engage in digital trade,” MercadoLibre articulated.
The United States described the agreement as “critical,” asserting its potential to assist smaller businesses in exporting goods to Mexico.
Amazon, which recently inaugurated sales of non-perishable food and beverages in Mexico, opted not to issue a comment. Meanwhile, Mexico’s retailers association, ANTAD, refrained from providing statements while discussions are still ongoing.
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