MEXICO RAISES TARIFFS ON AMERICAN WINE
Responding to President Clinton's adoption of a trade measure to protect the
U.S.
broom industry, Mexico increased tariffs on American brandy and wines as well as
wooden
furniture, glass, and notebooks. Of particular interest to California is Mexico's decision
to
impose a 20 percent duty on wine. Accounting for 90 percent of total U.S. production,
the
California wine industry expects that the move will significantly affect the state's wine
sales in
Mexico. The issue of liquor tariffs is not a new one. Mexico attempted throughout the
NAFTA negotiations to protect its developing brandy industry and Baja California's
fledgling
wine manufacturers. Mexico's wine industry, which produces less than 10 million
cases a
year, is grappling to establish markets in Mexico. The Mexican action responds to the
President's November 28 imposition of a tariff on 40 percent of Mexico's straw broom
exports.

Volume 3, Bulletin 43 -- December 18, 1996