Mexico to impose $2.4 billion in retaliation over cross-border truck program
March 18, 2009
World Trade\Interactive
Mexico announced March 16 that it will retaliate against $2.4 billion worth of U.S. exports after President Obama signed into law last week a bill that terminates a cross-border trucking pilot program. According to press reports, Mexican Economy Minister Gerardo Ruiz Mateos said tariffs will be imposed on nearly 90 agricultural and industrial products from 40 states.
The pilot project allowed up to 100 Mexico-domiciled motor carriers to operate beyond the border commercial zones and the same number of U.S. carriers to operate in Mexico. It was designed to move the U.S. toward compliance with NAFTA requirements that should have taken effect years ago. Implementation had been consistently delayed over what opponents said were concerns about the safety of Mexican trucks, although many observers said the real issue was competition for U.S. trucking companies. Ruiz indicated that Mexico agrees with that view, calling the termination of the pilot program “protectionist” and a clear violation of U.S. obligations under NAFTA.
An official list of the goods subject to the retaliatory tariffs has yet to be released but is expected soon. Some Republican lawmakers said the list would likely include rice, beef, wheat and beans. According to Reuters, however, a spokesman for the Mexican economy ministry specifically said those goods would not be included “because Mexicans are sensitive to them.”
Sen. Byron Dorgan, D-N.D., a longtime opponent of the pilot program, called Mexico’s action “an outrage.” He added that Mexico, a country that has run a $453 billion trade surplus with the U.S. over the past decade, “has a lot of nerve to suggest in any way that we are being unfair to them.” Dorgan asserted that Congress had ended the pilot program due to “serious safety concerns” and that “no trade agreement should obligate us to compromise our highway safety.”
Obama administration spokesman Robert Gibbs responded to the news by saying that the departments of State and Transportation, along with the Office of the U.S. Trade Representative, would work to devise a new cross-border trucking program that “will meet the legitimate concerns of Congress and our NAFTA commitments.” Dorgan indicated that he is willing to “work in good faith” on this effort, and House Ways and Means Committee Ranking Member Dave Camp, R-Mich., and Trade Subcommittee Ranking Member Kevin Brady, R-Texas, expressed their support as well. However, private-sector groups like the Owner-Operator Independent Drivers Association and the Teamsters Union said there will have to be significant improvements to Mexican truck safety laws before they will support such a program.
Click here for list of products affected by the tariff |
|
