US, Mexico sign trucking agreement - NPPC pleased
The National Pork Producers Council called a “good first step” the signing (6 July) by the US and Mexican governments of an agreement that will allow Mexican trucks to haul goods into the United States and that cuts by half Mexico's tariffs on U.S. exports, including pork.
The Mexican tariffs on more than $2.4 billion of US goods, including a 5 percent duty on most US pork, will be reduced by 50 percent after the Mexican government gives public notice of the agreement, which is expected Thursday. When the first Mexican trucks are allowed – later this summer – to carry products into the United States, the duties will be suspended.
Cuttiing tariffs on pork
“US pork producers are very pleased that Mexico has agreed to cut the tariffs on US products, including pork. It’s a good first step toward resolving the trucking dispute,” said NPPC President Doug Wolf, a producer from Lancaster, Wis. “Now we need the US government to follow through by allowing Mexican trucks into the country so that tariffs on our products will be suspended.”
The agreement resolves a long-standing dispute between the nations over a trucking provision of the 1994 North American Free Trade Agreement (NAFTA). The provision was set to become effective in December 1995, but the United States failed to abide by it.
Mexico trucks violated US obligations
In February 2001, a NAFTA dispute-settlement panel ruled that excluding Mexican trucks violated US obligations under the trade deal. The ruling gave Mexico the right to retaliate, but the United States delayed the retaliation by implementing in September 2007 a pilot program that allowed a limited number of Mexican trucks into America. When in March 2009 Congress failed to renew the pilot program, Mexico imposed tariffs on 89 US products. It added products, including pork, in August 2010 after the Obama administration failed to present a proposal for resolving the trucking dispute.
Mexico is the second largest market for the US pork industry, which shipped $986 million of pork south of the border in 2010. Since 1993 – the year before NAFTA was implemented – US pork exports to Mexico have increased by 780 percent.
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