Quito, Ecuador – President Daniel Noboa of Ecuador announced on Monday that his administration will impose a 27% tariff on all goods imported from Mexico. This measure will remain in place until a free trade agreement is signed between the two nations. The announcement comes at a time when diplomatic relations between Ecuador and Mexico remain strained following the raid on the Mexican embassy in Quito to arrest former Vice President Jorge Glas.

President Noboa reaffirmed his commitment to signing a free trade agreement with Mexico. However, he justified the new tariff by stating that the current non-oil trade between the two countries is "abusive" for Ecuador, which has a negative trade balance with Mexico. This means that Ecuador imports more goods from Mexico than it exports.

The tariff announcement comes just days after the United States imposed tariffs on Mexico and Canada, and Ecuador recently concluded trade agreement negotiations with Canada. Ecuador and Mexico came close to signing a free trade agreement in 2022, but negotiations stalled due to Mexico's reluctance to eliminate tariffs on shrimp and bananas, two of Ecuador's key export products. This impasse also hindered Ecuador's efforts to join the Pacific Alliance, a regional integration mechanism that includes Chile, Colombia, Mexico, and Peru.

"We reiterate our position to sign a free trade agreement with Mexico," Noboa said in his statement. "But until that happens and becomes a reality, we are going to apply a 27% tariff to the products we import, with the objective of promoting our industry and ensuring fair treatment for our producers."

The Ecuadorian president also shared a graphic illustrating the country's trade balance with Mexico from 2021 to the present, showing negative values ranging from $218 million to $588 million annually. In 2024, Ecuador's non-oil imports from Mexico totaled at least $551 million between January and November, while its exports to the Mexican market for the same period were valued at $333 million, resulting in a negative balance of $218 million for Ecuador.

Among the most imported products by Ecuador from Mexico are medicines, valued at $66 million in 2024; light vehicles, with $40 million; and household appliances, with $38 million. The remaining $407 million were for imports of other products such as shampoos, hygiene items, computers, flour preparations, pipes, and alcoholic substances for making beverages.

The announcement of the economic sanction on imports from Mexico comes at the start of the election week in Ecuador, where the current president is seeking re-election in the vote called for this Sunday, February 9.

Ecuador and Mexico broke diplomatic relations in April 2024, after the police raid ordered by Noboa on the Mexican Embassy in Quito to arrest Glas, after he had received diplomatic asylum from the government of Andrés Manuel López Obrador, declaring himself a political persecuted in the face of convictions and processes for corruption that the correísta maintains in Ecuador.

The diplomatic crisis also led to litigation in the International Court of Justice in The Hague with mutual accusations of having violated conventions that govern international law. Mexico accuses Ecuador of skipping the inviolability of diplomatic headquarters, and Ecuador maintains that Mexico misused the treaty that governs diplomatic asylum.