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Mexico Balks at Modifications to Previously Negotiated USMCA

05/15/2019

The USMCA signed by the Presidents of Mexico and the U.S. and the Prime Minister of Canada have yet to be ratified by all three legislatures of the participating nations. Apart from the issue of rescinding steel and aluminum tariffs imposed unilaterally by the U.S. affecting both Canada and Mexico, the latter nation is implacable with regard to changing labor conditions.

The Democratic caucus in the House is demanding greater protection for U.S. workers, and stricter environmental and prescription-drug provisions.

Jesus Seade, Undersecretary for North America for the Government of Mexico indicated that his nation does not anticipate any changes from the conditions as negotiated. Mexico will not allow inspection of factories but will fully enforce labor reforms that coincide with the policies of the Administration of President Lopes Obrador.

The position of Mexico is that the agreement should be ratified by all parties as negotiated and if changes are required, they can be considered when the USMCA is renegotiated.

Currently the U.S. and its neighbors function under NAFTA which has served to regulate trade for 25 years. With the passage of time, new considerations have necessitated changing aspects of the relationship among the three nations. Unless USMCA is ratified, disruption of trade will occur to the detriment of the agricultural sector and especially impacting broiler and egg exports that will be placed at a disadvantage if Mexico imposes tariffs.