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4w ago

EU and Mexico Sign Modernized Free-Trade Pact in Mexico City

It expands the 2000 agreement to cover services, digital trade and critical raw materials ahead of a European Parliament ratification.

Mexico's President Claudia Sheinbaum speaks during a daily press conference, after the U.S. Justice Department said it had charged the governor of Mexico's Sinaloa state, Ruben Rocha, and other officials for their alleged involvement with the Sinaloa Cartel at the National Palace, in Mexico City, Mexico April 30, 2026. REUTERS/Henry Romero/File Photo
European Commission President Ursula von der Leyen arrives for a meeting of the College of European Commissioners in Brussels, Belgium, May 6, 2026. REUTERS/Yves Herman
EU chief Ursula von der Leyen signed an expanded trade deal with Mexico aimed at mutually reducing their dependence on trade with the United States
Mexico and the European Union have both been hit by US President Donald Trump's steep tariffs

Overview

  • Leaders formally signed the updated deal in Mexico City on Friday, May 22, 2026, moving an agreed text into a signed pact that now must clear EU ratification steps.
  • The pact broadens the 2000 accord to add services, government procurement, digital trade, investment and agricultural products while granting duty-free access for most goods.
  • The deal includes specific safeguards for sensitive farm sectors, notably a 5,000-tonne Mexican beef quota with a 7.5 percent preferential tariff, plus other product quotas to protect European farmers.
  • It contains provisions to ease EU access to Mexican critical raw materials and bars price discrimination against Mexican buyers to help diversify supply chains away from China.
  • Mexico’s economy ministry projects exports to the EU could rise from about $24 billion to $36 billion by 2030 and the pact is presented by leaders as a step to reduce heavy reliance on the U.S. market.