Mexico’s Ministry of Economy proposed a new round of negotiations with the United States on Thursday to resolve a dispute over the Mexican energy sector.
Mexico hopes to avoid a large-scale trade claim under the provisions of the USMCA trade agreement.
Initially, the United States requested dialogue in July, but so far no solution has been reached. Washington could demand an arbitration panel and the dispute could culminate in trade sanctions for Mexico.
The United States claims that Mexico is unfairly favoring state-owned electricity and oil companies over US competitors and clean energy providers. Canada has also joined that complaint.
US Trade Representative Katherine Tai appeared open to continuing the dialogue, but her office said the official “highlighted the urgency of timely and meaningful progress on our current consultations” during her meeting on Thursday with Mexico’s economy secretary, Rachel Buenrostro.
Buenrostro’s office said that “it was highlighted that Mexico seeks to reconcile differences in the consultation phase, without the need to reach an arbitration panel and guaranteeing national sovereignty.”
Buenrostro “raised the proposal to establish trinational working groups, which would meet during December and early January” in order to have an agreement ready for the North American Leaders Summit to be held in Mexico on January 9 and 10 Commercial disputes threaten to overshadow the meeting.
The United States government opposes an energy reform that seeks to limit the operations of power plants that use renewable sources and that were built with foreign investment in the country, and grant a greater share of the market to the Federal Electricity Commission. The T-MEC prohibits favoring local companies over those of other member states of the agreement.
Mexico and the United States also appear to be headed for another trade dispute over the Mexican ban on imports of transgenic yellow corn.
President Andres Manuel Lopez Obrador has said that Mexico will not reverse the ban on imports of transgenic corn for human consumption and would study the possibility of eventually banning it for animal consumption as well.
The Mexican president pointed out the need to protect human health and native varieties of corn from genetic contamination. Mexico is considered the cradle of corn.
Mexico has imported GM corn for human consumption for years, raking in about $3 billion a year to become the top export market for US corn.
Tai’s office said it “underscored the importance of avoiding any disruption to US corn exports to Mexico, for both human and animal consumption, and adhering to a regulatory approval process for all biotech agricultural products in Mexico based on science and risks.
Tai noted that the United States also wants more progress in Mexico’s “enforcement of environmental laws related to fishing activities.” That was an apparent reference to Mexican fishing practices that have driven the vaquita, the world’s smallest porpoise, to the brink of extinction, as well as posing threats to sea turtles, dolphins and other animals.
Source: El Nuevo Herald