Due to increased tariffs and political uncertainty worldwide, which is impacting cargo activity and complicating investment decisions, Fitch Ratings estimated that the outlook for seaports in North America and Europe, Middle East and Africa (EMEA) will be “deteriorating” by 2026 .

The rating agency detailed that, in North America, ports are facing disruptions due to policy changes.

“Fitch expects nominal declines in 2026 volumes amid low GDP growth and an adverse tariff environment. A temporary de-escalation between the United States and China offers limited relief,” the international organization explained in its analysis.

Higher US tariffs on construction raw materials may increase capital input costs or delay projects, although cruises provide some compensation, but remain sensitive to consumer confidence.

The study noted that the “deteriorated” outlook for EMEA reflects Fitch’s expectations of modest or stagnant maritime trade as higher tariffs take effect .

“We expect eurozone GDP growth to be around 1.3% in 2026. The long-term trade trajectory between the United States and China is the key uncertainty in our outlook,” he said.

Meanwhile, European operators face divergent volume trajectories and “softer” trading conditions.

Current security risks in the Red Sea and the Suez Canal, as well as sanctions-driven diversion, are reshaping flows, with uneven trends in the Mediterranean and Northern Europe.

“Capacity additions in Antwerp and Rotterdam, as well as the expansion of Mersin in Turkey and Limak in 2027, are aimed at easing tensions after near-maximum utilization in 2025 and labor-related delays,” the report detailed.

The outlook for seaports in Asia-Pacific (APAC) and Latin America is “neutral” , reflecting a relatively resilient regional dynamic.

“In APAC, volumes are cushioned by strong intraregional activity, while recent trade agreements with the United States have reduced uncertainty for exporters,” he noted.

In Latin America, maritime trade remains resilient, supported by strategic trade routes and increased agricultural exports, and the performance of seaports is expected to extend the recovery beyond 2025, despite tariff and geopolitical challenges.

Fitch’s estimates maintain a cautious outlook for North America and EMEA, with deteriorating sectoral prospects.

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Lower investment, as well as a possible recession and reduced employment in the construction and manufacturing sectors, will lead to a decline in Mexican consumption, Fitch Ratings believes , warning that the purchase of goods and services will remain weak through 2025.

According to an analysis by the rating agency, private consumption in Mexico has declined since December 2024, specifically with regard to goods and imports.

“Same-store sales (SSS) have slowed since the fourth quarter of last year, with sales growth falling to 2.5% in March 2025, from 5.4% the previous year, according to the National Association of Self-Service and Department Stores (ANTAD) ,” the report noted.

Demand for items such as clothing, appliances, and electronics, especially among low- and middle-income consumers, faces the greatest risk, he added.

The rating agency warned about the possible growth of consumer credit , which buyers could use to finance their purchases, which could lead to bad loans.

“Increased loan origination to support sales by retailers with financial divisions could lead to potentially higher non-performing loans by the end of 2025,” he stressed.

For non-discretionary items such as food, consumer preference is shifting toward discount formats and private-label products.

“Own-brand products now represent between 20% and 50% of sales in smaller store formats, compared to approximately 5% five years ago, indicating increased demand,” Fitch said.

Despite the anticipated adverse environment, the rating agency estimated that most retail and consumer companies are prepared to weather a cyclical downturn , “without facing widespread negative rating actions.”

“Revenue for most rated retailers is expected to grow by mid- to high-single digits in 2025-2026, driven by expansion into new markets and store format adjustments,” the firm noted.

Private consumption has fallen into a period of caution generated by the upward trend in inflation in Mexico, which stood at  4.42%  last May in its annual comparison and 4.51% in the first half of June , as well as by changes in the United States’ trade policy , which has increased the uncertainty when deciding on the acquisition of goods and services.

In this regard, the National Institute of Statistics and Geography (INEGI) reported that private consumption, which is one of the country’s economic drivers, fell 0.4% in the first quarter of 2025.

The slowdown in various industries and a persistent inflationary context have affected consumer confidence, which has led to some changes in its habits, according to Kantar .

According to the consulting firm, consumers are looking for more affordable and convenient options. Along these lines, the firm indicated that 60% prefer to eat at home, while 44% have sought ways to cut back on entertainment expenses outside the home.

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El cargo Consumption in Mexico will remain weak in 2025, Fitch Ratings predicts. apareció primero en T21.

The joint statement on the Economic and Trade Meeting between the two countries in Geneva, Switzerland, which was released on May 12, appears to be merely a significant de-escalation of the trade war between the two nations , the rating agency estimated.

“However, in the absence of a lasting agreement, uncertainty about where tariff rates will be set and the impact of those already in place will remain key factors in our macroeconomic forecasts,” he stressed.

This announcement suggests a desire to avoid a sustained collapse in trade flows between the United States and China, which would severely affect the world’s two largest economies.

“The reduction in the reciprocal tariff rate from 34% to 10% echoes the approach taken by the United States for many trading partners in President Donald Trump’s Executive Order of April 9. Even more striking, it also undoes the sharp escalation that had pushed bilateral tariff rates between the United States and China into triple digits,” Fitch explained.

The agreement reduces the United States’ effective tariff rate (ETR) from approximately 23 percent  to 13 percent .

“While this would imply a minor impact on global growth, all else being equal, it would still be much higher than our northern neighbor’s 2.3% ETR in 2024, with a nearly universal 10% tariff and some higher sectoral tariffs,” he explained.

It’s worth noting that Fitch Ratings lowered its global GDP forecast for 2025 to 1.9% following the April tariff escalation and the outlook for trade flows between the United States and China.

Despite the tariff relief from the announcement, the US ETR for China remains the highest of any trading partner, at an estimated 31.8% , according to Fitch’s US Effective Tariff Rate Monitor .

“The administration of US President Donald Trump appears to be using tariffs to pursue an import substitution agenda aimed at boosting US manufacturing and reducing the trade deficit, making further disruptions to trade flows and supply chains likely,” the rating agency noted.

Fitch Ratings believes trade and related data are likely to remain volatile in the coming quarters as these effects unfold, noting that negotiations will continue to act as a drag on investment across various sectors.

On May 12, the United States and China reached an agreement to reduce their tariffs and declare a 90-day  truce , which went into effect on Wednesday, May 14 .

With this agreement, the northern neighbor will reduce tariffs on Chinese products from  145%  to  30% , including those related to combating fentanyl trafficking. For its part, China will reduce tariffs   on US products from 125% to  10% .

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The rating agency noted that companies with greater exposure to the manufacturing sector are likely to be the most affected, due to recent changes that have altered the outlook for the relocation of production lines in Mexico, i.e., nearshoring .

“These obstacles are mitigated by the sector’s conservative business models, solid occupancy rates, and stable financial profiles,” the firm emphasized.

Approximately 80% of the manufacturing sector ‘s customers are exporters, with the United States being the primary destination for their products. In this regard, the automotive industry , one of the most vulnerable to tariffs , represents almost a quarter of the gross leasable area (GLA) of Fitch-rated companies in the sector.

“As of the first quarter of 2025 (1Q25), rated issuers presented a balanced GLA mix between manufacturing (47%) and logistics/consumer goods (53%), with the northern region of Mexico accounting for the majority of GLA (46%) and ongoing development projects (56%). The majority of logistics/consumer goods GLA is located in the central region of the country and is almost entirely allocated to the local market,” he explained.

It’s worth noting that Fitch Ratings forecast that Mexico’s Gross Domestic Product (GDP) will decline 0.4% in 2025 before recovering 0.8% in 2026, due to the global trade war that began this year and has generated uncertainty among investors and in various markets around the world.

“While the magnitude, scope, and permanence of the tariffs and potential retaliatory measures remain unclear, the uncertainty is already prompting Mexican real estate companies to reevaluate the timing of their investments and consider alternative scenarios as demand slows,” he stressed.

He noted that companies such as Fibra Prologis and Fibra MTY acquire operating assets rather than developing them from scratch, which reduces start-up risk.

On the other hand, he emphasized that Vesta and Fibra MTY have a high leverage margin, although the latter has greater exposure to the manufacturing sector, so it could be more affected by the tariff war.

The rating agency expects rated real estate issuers to maintain stable capital structures in 2025 and indicated that they are likely to reduce investments to maintain occupancy rates amid lower demand.

According to CBRE , a commercial real estate services and investment company, in 2024 total sales or national gross absorption registered an annual growth of 5% , while the share of nearshoring  with respect to total accumulated sales was  28% , which meant a figure similar to that of 2022 and 2023.

Last year, demand for industrial real estate due to the relocation of production lines in Mexico exceeded two million square meters (m2) , according to the firm.

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This, the rating agency stated, could put pressure on the profitability of automakers and their short-term free cash flow.

On April 3, the executive order signed by Donald Trump , President of the United States, on March 26, went into effect. This order imposes 25% tariffs on vehicles, light trucks, and auto parts imported into the United States.

According to Fitch Ratings , this measure represents a significant risk for automakers that import vehicles manufactured in Mexico, Canada, Japan, Korea, and Germany to the United States.

He also pointed out that the implications for suppliers of tariffs on auto parts are less transparent due to the complexities of the supply chain.

“In addition to rising costs, there are risks of delays and supply chain disruptions affecting U.S. auto manufacturing, similar to those in 2021-2022. However, this is temporarily mitigated by the delay of tariffs on auto parts that comply with the United States-Mexico-Canada Agreement (USMCA),” he added.

The agency also adjusted its U.S. vehicle sales projection for 2025 to 15.2 million units from a forecast of 16.3 million . For Europe, the adjustment was from 13 million to 12.5 million units .

“While we expect direct tariff implications to vary across automakers, depending on their production footprint, pricing, power, and supply chain configuration, no issuer will be entirely immune to declining consumer confidence and weaker auto demand,” Fitch emphasized.

Under that scenario, the rating agency expects automakers to raise prices worldwide to offset the U.S. tariffs, although the tariff implications for brands and models may vary.

“Some automakers may struggle to raise prices enough to cover the 25% tariff and will have to make painful adjustments to production and sales plans,” he added.

The firm estimated that suppliers and automakers could share the burden of higher tariffs. “Many suppliers will try to shift the costs of the tariffs to automakers, who will have to absorb most of them through price increases,” it emphasized.

Uncertainty related to tariffs could lead to fluctuations in production volumes, which could negatively impact the cash flows of suppliers dependent on automakers.

In response to the U.S.  tariffs on imported vehicles, the Mexican Automotive Industry Association (AMIA) , the  National Auto Parts Industry (INA) , and the  Mexican Automobile Distributors Association (AMDA)considered that this measure significantly harms the North American automotive industry.

80% of the vehicles that Mexico manufactures to send abroad are exported to the United States, so the 25% tariffs affect various automotive brands, including  General Motors (GM) which in 2024 exported 830,820 units , of which  711,582 were sent to its northern neighbor, as well as Ford which sent 358,366 units to the United States , according to figures from the National Institute of Statistics and Geography (Inegi) .

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Due to the increase in tariffs on Mexican goods exports to the United States, driven by Donald Trump , president of the United States, Fitch Ratings has estimated a challenging outlook for Mexico’s banking sector , in which the sector will face greater credit deterioration and profit pressure.

“Capital buffers and liquidity profiles support the ratings, but uncertainty caused by the impending tariff-induced recession elevates credit risk,” the firm noted.

In its analysis, Fitch Ratings indicated that Mexican banks will face revenue pressure and margin compression due to their negative sensitivity to lower rates and higher credit costs.

He stressed that this would specifically affect small and medium-sized banks, “whose lower capital bases and less diversified business models tend to be more sensitive to industries vulnerable to increased US tariffs, such as the industrial, agricultural, automotive, construction, energy, and mining sectors.”

The country’s seven largest banks, which account for 71% of total assets, will also feel the impact, but their diversification could partially mitigate the effects. However, the recession resulting from tariffs will affect sectors such as housing, retail, and construction.

“Corporate lending will be more sensitive to credit demand from key industries closely linked to the U.S.-Mexico relationship, trade relations, and investor confidence in the country. However, the banking system’s exposure to segments sensitive to U.S. tariffs and exposure to the U.S. dollar in certain sectors is moderate,” he warned.

The institution warned that the depreciation of the Mexican peso is a risk, and estimated that Mexico’s business environment has been affected by judicial reform and labor cost inflation , “exacerbated by significant uncertainty about the timing and magnitude of U.S. tariffs, which is weighing on capital spending and reducing consumer confidence.”

Despite this uncertainty, he considered that the Mexican banking system is well positioned to absorb the risks arising from an economic contraction.

In this regard, he noted that Mexican banking systems weathered the global financial crisis and the COVID-19 pandemic, and clarified that the rating downgrades during these periods were due to sovereign debt downgrades and not to pressure on their independent ratings.

It’s worth noting that Fitch revised its growth forecasts for Mexico downward due to the increase in US tariffs, estimating that real GDP growth will be 0%and 0.8% in 2025 and 2026, respectively.

On March 24, Trump announced that some countries would receive  exemptions from the tariffs to be announced on April 2, because he was “embarrassed” to charge them.

“I may give exemptions to many countries. They’ve charged us so much that I’m embarrassed to charge them what they’ve charged us, but it will be substantial, and they’ll know it on April 2nd,” the US president stated.

Meanwhile, Mexican President Claudia Sheinbaum said at her morning press conference Wednesday that the country could receive differential treatment in the widespread imposition of tariffs due to its participation in the United States-Mexico-Canada Agreement (USMCA) ; Negotiations are continuing to try to stop the 25 percent levy .

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El cargo US tariffs will also hit Mexican banking, warns Fitch Ratings. apareció primero en T21.

Fitch Ratings has predicted a technical recession for Mexico as a result of the tariffs imposed  by US President Donald Trump , and has also lowered its growth projection for the country in 2025.

“We anticipate a recession in Mexico, where we have cut our 2025 forecast by 1.1 percentage points to 0 percent,” the institution reported in its World Economic Outlook – March 2025 report.

The rating agency also lowered its growth forecast for 2026 to 0.8% , a nine percentage point decrease from its previous estimate.

In his analysis, he noted that the new US administration has launched a global trade war that will reduce growth in the US and globally, boost inflation in the US, and delay rate cuts by the Federal Reserve (Fed).

“We have cut both our 2025 US growth forecast to 1.7% from 2.1% in the December 2024 World Economic Outlook and our 2026 forecast to 1.7% to 1.5%. These rates are well below trend and below the annual growth of nearly 3% in 2023 and 2024,” he warned.

Fitch Ratings estimates that the impact will be felt globally, forecasting that global growth will slow to 2.3% in 2025. It also indicated that growth will remain weak at 2.2% in 2026.

“This is a downward revision of 0.3 percentage points and reflects widespread declines in developed and emerging economies. Growth will remain weak, at 2.2% in 2026,” he stated.

He noted that the U.S. effective tariff rate (ETR) has already risen to 8.5% from 2.3% in 2024 and warned that further increases are likely.

“Our latest economic forecasts assume a 15% ETR will be imposed on Europe, Canada, Mexico, and other countries in 2025, and 35% on China. This will bring the U.S. ETR to 18% this year before moderating to 16% next year as Canada and Mexico’s ETRs fall to 10%. This would be the highest rate in 90 years,” he stressed.

He noted that there is great uncertainty about how far the United States will go and noted that there are risks of a “major tariff shock,” even due to an escalation of the global trade war.

“Tariff increases will result in higher consumer prices in the United States, reduce real wages, and increase business costs, while increased political uncertainty will hurt business investment. Retaliation will hurt U.S. exporters. Global export-oriented manufacturers in East Asia and Europe will also be affected,” he noted.

Fitch Ratings’ forecasts are in line with those of the  Organization for Economic Cooperation and Development (OECD) , which estimated that the 25% tariff levied on various Mexican products that  Donald Trump is seeking to impose , and which was suspended for goods covered by the  United States-Mexico-Canada Agreement (USMCA)  until April 2, would cause the   country’s  Gross Domestic Product (GDP) to contract by 1.3%  in 2025.

In its OECD Economic Outlook, March 2025 Interim Report , the organization noted that if the United States’ tariff policy is maintained, this contraction, projected at 0.6% for 2026, would cause an economic recession for Mexico, being the only country with negative figures in this regard.

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The imposition of 25% tariffs on various Mexican products by the United States has heightened the uncertainty among business owners about investing and threatens the prospects for the relocation of companies to Mexico ( nearshoring ) , warned the rating agency Fitch Ratings .

In its analysis, U.S. tariffs exacerbate macroeconomic concerns for Mexican companies , the firm noted that this uncertainty has already damaged business confidence and threatens to destabilize structural hopes for nearshoring in Mexico.

“Infrastructure and security issues have been constraints. More recently, Mexico’s business environment has been affected by emerging concerns about judicial reform, a weakening fiscal position, energy security and inflation in labor costs,” he said.

The rating agency noted that the industrial and automotive sectors will also feel the effects of tariffs more directly.

In this regard, he stressed that this measure will have an immediate impact on Mexico’s automobile suppliers and on the diversified industrial sector , “given the high level of integration of the supply chain with the United States.”

“Fitch does not expect the automotive industry to completely reorient supply chains to avoid tariffs, as it would take years and may not be financially viable. Mexican suppliers will likely pass on incremental costs to original equipment manufacturers, who will raise prices to compensate. Higher prices will lead to lower sales and production, increasing suppliers’ volume risk,” the study said.

Among Fitch’s rated portfolio of global automakers, Honda , General Motors , Nissan and Stellantis have the largest presence in Mexico and Canada.

The tariff changes will also affect suppliers of critical components for the automotive industry, such as Nemak and Metalsa , which have a significant market share, making them difficult to replace.

In his analysis, he said that an increasingly likely domestic recession would have a widespread impact on other corporate sectors, such as housing, construction and retail.

“Continued currency depreciation would have more idiosyncratic effects, depending on the exchange rate mismatch between debt and EBITDA generation, and domestic-focused issuers are likely to be more negatively affected,” he added.

Fitch estimated that for other Mexican corporate sectors, direct exposure to US tariffs is moderate to low . “Downside risks to earnings estimates are high, as most Mexican companies have not yet incorporated the impact of US tariffs into their earnings guidance.”

Meanwhile, Fitch’s international ratings for Mexican companies are heavily biased toward low to medium investment grade.

With the tariffs coming into effect, Fitch said the scenario is more complicated than more moderate scenarios, which assumed a 25% tariff on a smaller basket of taxable imports, although the duration of the tax remains uncertain.

It is worth remembering that on March 4, the United States began charging a 25% tariff on Mexican products, although this Wednesday the president of our northern neighbor, Donald Trump , paused the tariff on vehicles from Mexico and Canada for a month.

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