The US places Mexico under the magnifying glass

Note published on May 12 in Ansa Latina, México [Mexico] Section by the Editorial Department
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The United States government is placing Mexico under a magnifying glass and is threatening to impose sanctions for violations of the Free Trade Agreement that both countries subscribed together with Canada (USMCA), in force since 1994 and renovated in 2020.

Additionally, the largest federation of unions in the United States, the AFL-CIO, announced having requested the government of its country to file the first labor complaint against Mexico under the USMCA, for labor abuses related to union affiliation.

Workers of Tridonex, a plant that manufactures automobile components, located in Matamoros, on the border with Texas, are not being allowed to disassociate themselves from the union that they belong to, the Confederation of Mexican Workers (CTM), to form an independent union.

The workers’ representative, Susana Prieto, denounced that some 600 people were fired last year in retaliation for their intention to change unions after the firm changed its headquarters from Philadelphia to the northern state of Tamaulipas.

The recent revision of the USMCA, promoted by former President Donald Trump, included a “Rapid Response Labor Mechanism”, through which companies from both countries can face tariffs and other sanctions if they fail to comply with their obligation of guaranteeing the rights of their employees, such as freedom of association.

Oscar de la Vega, a labor lawyer at the D&M Firm, predicted that as a result of “the pressure and monitoring by the United States government” and under the new terms of the agreement, Mexico will face “labor conflicts like never before.”

“It is part of the re-arrangements and many unions will disappear because they have not understood the new dynamics”, he pointed out. American unions have made it known that they are interested in having an influence on the improvement of working conditions in Mexico and avoiding unfair competition, as a requirement to maintain bilateral free trade.

Katherine Chi Tai, the new United States Trade Representative, pointed out on April 28, before a committee of the House of Representatives, that there are serious “concerns about the manner in which Mexico is handling its obligations within the USMCA” and that she has already talked about them with the Minister of Economy of this country, Tatiana Clouthier.

The official revealed that she is “not afraid to use the tools for applying the rules” provided for in the USMCA, which can “lead us into a scenario of cooperation, confrontation or a combination of both.”

A few days ago, the American Petroleum Institute (API) sent a letter to the Secretary of State, the Secretaries of Commerce and Energy and to the Trade representative of the Biden government, to protest “the discrimination against companies from its country in the Mexican energy market” within the framework of the new USMCA.

The API is a highly influential body that brings together United States businessmen, which argues that the new laws of the electricity and hydrocarbon industry in Mexico modified the rules to benefit State industries, Pemex and the Federal Electricity Commission (CFE) and to be prejudicial to its members.

This has affected private companies with large investments in Mexico, which has destroyed their “economic value” in violation of several provisions of the USMCA, “Unfortunately, things are not looking good. These news are very worrying “, stated analyst Leo Zuckermann, who said that “At this moment, Mexico’s economic growth depends critically on its commercial relationship with the United States.”

“Exports to that country are practically the only engine that the Mexican economy has turned on. Thus, today, more than ever, we have to take care of this lifeline”, he warned.

“It is urgent that the United States government works diplomatically with the Mexican government to solve this problem”, said the expert, who pointed out that “the only thing that we need now” in this country is “taking on Goliath.”