Trade war continues over Mexican truck issue

Aug. 17, 2010
A trade war continues as the U.S. continues to forbid cross-border operations for selected Mexican trucks

A trade war continues as the U.S. continues to forbid cross-border operations for selected Mexican trucks.

This week, Mexico added tariffs to 99 more products imported from the U.S. in retaliation for the American stance against opening up its southern border to cross-border trucking operations as called for in the North American Free Trade Agreement (NAFTA).

According to the Associated Press, Mexico’s latest step will affect about $2.5 billion worth of trade involving agricultural and industrial products from 43 U.S. states. In May 2009, Mexico put $2.4 billion worth of tariffs on 90 products after the U.S. canceled a pilot program that allowed some cross-border operations by select Mexican carriers.

“We have to act firmly so we can sensitize U.S. authorities about the urgent need to open that sector, which transports 70% of the commercial volume between both countries,” Mexico’s Economy Secretary Bruno Ferrari said in the statement.

The move comes at a time when surface trade between all the NAFTA partners – Canada, the U.S. and Mexico – is on the rebound.

Trade using surface transportation between the three nations increased 39.5% in May 2010 compared to the same month in 2009, reaching $66.8 billion, according to the U.S. Dept. of Transportation’s (DOT) Bureau of Transportation Statistics (BTS) – the largest year-over-year percentage increase in total U.S.-NAFTA trade by surface modes on record dating back to April 1994.

U.S.–Mexico surface transportation trade totaled $26.6 billion in May this year, up 42.7% compared to May 2009, with the value of imports and exports carried by truck some 36.1% and 43.2% higher, respectively, in May this year compared to the same month in 2009, BTS noted. Texas led all states in surface trade with Mexico in May with $9.4 billion, the agency added.

Still, several groups believe the U.S. should maintain the current ban on Mexican trucks despite the continuing trade dispute.

“Instead of slapping additional tariffs on U.S. goods, Mexico should be living up to its end of the bargain by making sure its drivers and trucks are safe enough to use our highways,” Jim Hoffa, general president of the International Brotherhood of Teamsters, said in a statement.

“If the U.S. trade representative had called out Mexico for their illegal tariffs more than a year ago, we would not be in this situation,” added Todd Spencer, executive vice president for the Owner-Operator Independent Drivers Association (OOIDA). “It was irresponsible to allow it to go on for this long.”

More than 18 months have passed since the tariffs were first imposed by Mexico because the U.S refused to open its borders to Mexican trucks, he noted.

“These bullying tactics should not be tolerated. The onus is on Mexico to raise safety, security and environmental standards for their trucking industry,” Spencer pointed out. “We should not allow ourselves to be blackmailed into lowering our standards.”

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