Mexico is working double time with Robert Lighthizer, a U.S. Trade Representative, to fix a crack in the latest North American trade agreement. A senior Mexican official noted that the action aims to meet the demands of Democratic politicians for stricter environmental and labor provisions.
The U.S., Mexico, and Canada inked the United States-Mexico-Canada Agreement (USMCA) last November, as a replacement to the North American Free Trade Agreement that presides over $1.2 million in mutual trades. However, any execution is bound for ratification from lawmakers in the three participating nations.
Jesus Seade, deputy foreign minister of Mexico to America, noted that the proposal he was arranging with Lighthizer was centered on clearing a dent in the agreement’s dispute resolution system.
Democrats from the widely Democratic-dominated U.S. Congress, have imposed threats to delay ratification not until their demands are met. Republican U.S. President Donald Trump had demanded the new trade deal be set to replace the former NAFTA.
House Speaker Nancy Pelosi’s spokesman Henry Conelly, did not share any insights about the substance of the ongoing negotiations. But, he said the primary concern of the House Democrats are the enforcement and labor provisions of the USMCA. Conelly added that Pelosi is continually working on USTR and her caucus to solidify crucial areas in the tendered agreement.
Seade said that now the deal is in effect, the United States may file a formal trade dispute against Mexico should the latter export products that are proven to be produced under labor situations it considers as unfair and opposing the rules set in the pact. However, he noted that the crack in the deal meant that Mexico could possibly block any dispute panel from being built.
The deputy foreign minister said in an interview with Reuters on Wednesday that there is a slit in the mechanism of the dispute resolutions under the trade. But, they are already looking for ways to fix it.
Mexico approved a law earlier this year that gives strength to rights of trade unions, an action that is relatively done to abide by the regulations in the USMCA. Weak labor laws in Mexico implied that for a number of years the country only had few independent unions, resulting to low wages, that the Democrats and Trump hold liable for the loss of U.S. jobs and excessive offshoring under the NAFTA.
Sease stressed that Mexico doesn’t want to, and doesn’t have any plans to, re-open the USMCA. Alternatively, he said, that the crack could be filled by supplementary measures to ensure that if the government of the United States would like to start a panel against Mexico regarding labor conditions, it may be able to do so.
Canada is also not in favor of re-opening the deal.
In the previous week, Earl Blumenauer, a senior Democratic lawmaker from the U.S., said that Mexico and Canada might be available for few renegotiations of aspects of the deal to gratify the concerns of the U.S. lawmakers.
Blumenauer, who spearheads the House of Representatives Ways and Means Committee’s trade sub-committee, told that the trade deal could be altered to meet particular concerns, but he was doubtful about using side agreements, stressing that it has been problematic had proven problematic in the ongoing NAFTA deal among the three countries.
Lighhizer’s office has not responded immediately to request for comments about the negotiations with Mexico. Last June, he told a Senate panel that he was open to working with the members “to make (USMCA) even better.”
Time is Running Out
The clock is ticking for ratifying the deal before the House of Representatives goes for its summer recess this July 27. Congress will return in September, and some officials from Mexico are worried that politics surrounding the U.S. 2020 presidential elections will make it difficult for lawmakers to have a consensus.
Canada’s parliament is viewed as less of an obstacle. Mexico, meanwhile, has already ratified the agreement.
Questioned about Mexico’s plan, a source from the Canadian government said that Prime Minister Justin Trudeau and others have already talked with Democrats to discuss the new NFTA and its benefits to people, the thing they most care about.