Mexico pushing labour reform, won’t ratify new NAFTA with U.S. tariffs in place

The push to improve workers’ rights in Mexico was a key priority for Canada

Mexico’s Congress will be asked to approve a major labour-reform bill this spring as a necessary step to ratifying the new North American free-trade pact later this autumn, say Mexican officials.

But unless the Trump administration lifts the punishing tariffs it has imposed on Mexican steel and aluminum imports — duties it also imposed on Canada — Mexico is prepared to keep the status quo with the 25-year-old North American Free Trade Agreement.

The push to improve workers’ rights in Mexico was a key priority for Canada and the United States during the rocky NAFTA renegotiation because they wanted to level the playing field between their workers and lower-paid Mexican workers, especially in the auto sector.

When Mexico and the U.S. reached their surprise bilateral agreement last August, forcing the Trudeau government to quickly forge a deal with the Trump administration, Foreign Affairs Minister Chrystia Freeland lauded Mexico for making labour concessions.

But a senior trade official in the new government of socialist reformer Andres Manuel Lopez Obrador suggested in an interview it wasn’t a huge sacrifice because elevating the status of country’s workers was a key plank in the platform that brought their Morena party to power.

Lopez Obrador made it clear in his election campaign that he wanted to strengthen the rights of workers and labour unions, which made a good fit with Canada’s bargaining position, Luz Maria de la Mora, Mexico’s deputy trade minister, said in an interview.

“With the agreement or without the agreement, this is something central to President Lopez Obrador — strengthening workers’ rights and strengthening trade deals in Mexico,” said de la Mora.

She said the new government wants a package of labour reform ratified in Mexico’s Congress before its April 30 adjournment “so we can reflect the commitments that we’ve made under the new U.S.-Mexico-Canada agreement in domestic legislation.”

That means the new agreement will be sent to the Mexican Congress for ratification after reconvenes in Sept. 1, she said.

But that won’t happen unless the United States lifts its so-called section 232 tariffs on steel and aluminum exports, said de la Mora.

U.S. President Donald Trump imposed tariffs of 25 per cent on steel and 10 per cent on aluminum from Mexico and Canada, using the controversial national-security clause in U.S. trade law — “Section 232,” as it’s called in shorthand — that both countries say was illegal.

Canadian Transport Minister Marc Garneau recently told Trump’s top economic adviser, Larry Kudlow, during a public panel in Washington that the tariffs are “a serious impediment to us moving forward on what is the best trade deal in the world.”

On Nov. 30, Prime Minister Justin Trudeau, Trump and former Mexican president Enrique Pena Nieto, who was on his last day in office, signed the new trade agreement. It now faces ratification by the legislatures of all three countries.

READ MORE: Tariffs could jeopardize new NAFTA deal in Parliament, Garneau warns

Trudeau spoke to Trump on Thursday and “raised the issue of steel and aluminum tariffs and expressed the need for the removal of tariffs,” the Prime Minister’s Office said.

If the tariffs aren’t lifted, de la Mora suggested Mexico is fine with the current version of NAFTA that remains in force.

“We hope to have this new agreement in place. But in the absence of the new agreement, we know that NAFTA is good enough,” she said.

Mexico would prefer the updated agreement “for the relations we have with the U.S. and Canada but we are OK with the current NAFTA.”

Mexican senators, who were in Ottawa the past week to conference with their Canadian parliamentary counterparts, echoed de la Mora’s assessment.

“We are going to approve it, but right now our government is trying to deal with this (the tariffs),” Sen. Antares Guadalupe said in an interview.

“We’re not in a rush. Trade right now, it’s working,” she added. “We have many things to do but we want to take it slowly because it is very important to have it in a very good way for Mexico.”

Sen. Hector Vasconcelos, the head of the Mexican Senate’s foreign-affairs committee, said the ratification of the new agreement is also subject to the domestic political situations in all three countries. That includes the ongoing turmoil in the Trump administration and Canada’s legislative clock, which will see the House of Commons adjourn in June until after the October federal election.

Asked what happens if the new agreement is not ratified, Vasconcelos laughed.

“Life goes on, I assure you,” he said, referring to the current NAFTA. “It’s good enough and we will try to get it better. That’s what we are going to do. We have to discuss a lot in Mexico.”

Mike Blanchfield, The Canadian Press


Like us on Facebook and follow us on Twitter.

Just Posted

City of Wetaskiwin presents 2019 budget at open house

Mayor Tyler Gandam said ‘zero based budgeting’ was council’s goal

New Democrats would bring in $25 daycare if re-elected: Notley

Notley said the plan would include adding 13,000 daycare spaces

Central Alberta livestock spring farm forecast

Alberta spring beef market looks steady, producers faring well

Supporters rally for Jason Kenney as UCP leader stops in Red Deer

Kenney promises equalization reform, stopping ‘Trudeau-Notley’ payroll hike, trade, economic mobility

The Millet Curling Club dates back to 1925

By 1936 Millet needed a bigger curling rink

The good, bad and the unknown of Apple’s new services

The announcements lacked some key details, such as pricing of the TV service

Morneau unveils principles for Indigenous ownership in Trans Mountain pipeline

The controversial pipeline was bought by Ottawa last year

Refugee who sheltered Edward Snowden in Hong Kong arrives in Canada

Vanessa Rodel and her seven-year-old daughter Keana arrived in Toronto this week

New UMSCA trade deal getting a boost from Trump, business groups

The trade deal is designed to supplant the North American Free Trade Agreement

Trudeau says he, Wilson-Raybould had cordial conversation last week

Trudeau denies anything improper occurred regarding SNC-Lavalin and the PMO

SNC-Lavalin backtracks on CEO’s comments surrounding potential job losses

Top boss had said protecting 9,000 jobs should grant leniency

Sources say Trudeau rejected Wilson-Raybould’s conservative pick for high court

Wilson-Raybould said Monday “there was no conflict between the PM and myself”

Social media comments continue to dog ranks of United Conservative candidates

Eva Kiryakos was running in Calgary-South East in the April 16 vote

Apple announces its long-awaited streaming TV service

The iPhone has long been Apple’s marquee product and main money maker, but sales are starting to decline

Most Read