Latest
Recommended
Published: Thu, May 18, 2017
Economy | By Melissa Porter

Mexico warns USA on trade

Mexico warns USA on trade

On the administration's broader trade strategy frequently described as an "America First" policy, Ross said "the goal is to increase overall trade while reducing our trade deficit", which means reducing barriers to U.S. exports. Mexico runs a sizeable trade deficit with China, the destination of about 10 percent of its exports.

About two-thirds, 68 percent, of Democrats see NAFTA as good for the US, while only 30 percent of Republicans hold the same view.

NAFTA is "at best out of date and at worst did not accomplish some of its most important goals", Wilbur Ross said of the trade pact that President Donald Trump calls a disaster for the United States. Talks are expected to start later this year.

"We will use (the China visit) geopolitically as strategic leverage" said Mexican Economy Minister Ildefonso Guajardo, answering questions on trade at the Mexico Business Forum.

Guajardo said the plan to trigger a United States withdrawal of NAFTA was done "in desperation, which occurs very frequently these days in those parts" - an apparent jab at the way Trump has rolled out some of his key policy proposals.

The research shows that about half of US citizens say the trade agreement is good for the USA, while 76 percent of Canadians say the agreement is good for Canada.

A Mexican diplomat in Beijing told Reuters he was referring to the China International Fair for Investment & Trade summit in Xiamen.

The US energy industry also relies on exports to Mexico, which is now the biggest export market for US refined oil products and natural gas, Smith said.

Mr. Ross cited Canada's negotiations with the European Union as an example of why multilateral trade deals don't work. "If they want to export yellow corn to me, I can raise tariffs to inaccessible levels", Guajardo said.

A delegation of Mexican officials and businesses traveled to Brazil and Argentina this month to look at the prospect of buying grains there.

Still, Mexico has found it hard to wean itself off trade with its northern neighbor. "The increasing integration of our economies makes Mexico critically important to the U.S. economy, not only as an export market, but also as a partner in production", the director of the embassy's trade and NAFTA office, Kenneth Smith, wrote.

The diplomat said Mexico was not sending top-level officials to "China's Belt and Road Initiative" meeting in Beijing this weekend.

However, he added bilateral meetings between senior Mexican officials and their Chinese counterparts were planned throughout the year, saying China's Deputy Minister of Land and Resources was now in Mexico.

However, and despite recent friction with Canada over dairy exports and softwood lumber imports, and with Mexico over sugar imports, Ross said, "We do not seek a trade war with anyone, least of all with our fellow citizens of the Americas".

He said that hiking tariffs or putting in place non-tariff barriers would be a last resort, but not one he would be afraid to do. "The precondition to negotiating NAFTA is that we can't go back to the past", he added.

If the United States were to withdraw from NAFTA, it would not necessarily mean the end of the trade deal.

And trade with Mexico has increased to the point where the country is now Canada's third most important trading partner, he said.

Like this: