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Latin America Tightens Trade Defenses as Cheap Chinese EVs and E-Commerce Surge

Deep Chinese financing has increased dependence, limiting how far governments can push back.

A woman shops at a store that primarily sells sports clothing imported from China in Asuncion, Paraguay, Saturday, Jan. 31, 2026. (AP Photo/Jorge Saenz)
Hybrid and electric vehicles shipped from China are unloaded from the BYD Changzhou car carrier docked at Terminal Zarate, in Argentina's Buenos Aires province, Tuesday, Jan. 20, 2026. (AP Photo/Victor R. Caivano)
Vendors wait for customers at a market that primarily sells clothing imported from China in Asuncion, Paraguay, Saturday, Jan. 31, 2026. (AP Photo/Jorge Saenz)
Clothing imported from China is on display for sale at a store in Quito, Ecuador, Saturday, Jan. 31, 2026. (AP Photo/Dolores Ochoa)

Overview

  • Chinese brands dominated Brazil’s 2024 EV market, taking more than 80% of over 61,000 sales, led by BYD and GWM.
  • In Mexico, Chinese-made cars reached about 15% of the market last year as authorities imposed tariffs of up to 50% on imports from China including autos, appliances, and clothing.
  • To curb low-priced parcels from platforms such as Temu and Shein, Brazil is phasing out tax-free thresholds for sub-$50 shipments and Chile began charging a 19% VAT on low-value packages in October.
  • Trade imbalances widened, with Mexico reporting a $101 billion deficit with China from January to October 2025 and Argentina nearly $8.2 billion for the year.
  • Commercial momentum persists as BYD unloaded more than 5,800 EVs and hybrids in Argentina under a quota allowing up to 50,000 tariff-free imports, while China’s exports to Mexico rose roughly 150% from 2017 to 2024.