J.O. Alvarez, Inc. Blog

MEXICO NAFTA TRUCKING UPDATE

Mexican trucks crossing Mexican border

A Notice of Arbitration by Mexican trucking association Canacar, filed in 2009, has not led the association to file for arbitration, according to the U.S. Department of State. That statement refutes earlier reports.

The Exelsior, a Mexico City daily, in a February 15, 2014, story quoted association director Jose Refugtio Munoz as saying that Canacar recently commenced arbitration seeking $30 billion in compensation.

The 2009 notice centered on Canacar’s contention that member companies lost money because United States did not uphold the North American Free Trade Agreement. The association director, Jose Refugio Munoz, said that the U.S. violated NAFTA by refusing to open its borders.

The association’s 2009 notice sought $6 billion in compensation. The notice claimed that member companies lost money because of the U.S. not adhering to NAFTA, but Canacar has taken no further action.

The Federal Motor Carrier Safety Administration is nearing the end of a cross-border pilot program with Mexico. The program began in October 2011 and will end in October of this year. Over the course of the program, the agency had admitted 13 carriers to the program. Decisions on admittance for four additional carriers are pending.

Participants in the program are subject to inspection, which the FMCSA will use as data to study the effectiveness of the program. The agency hoped to achieve 4,100 inspections by the end of the three-year pilot but have already passed that number.

Throughout the pilot, most Mexican participants have limited their travel to border states, probably due to overhead costs associated with long-distance trucking. Despite that, Canacar has argued that the United States is limiting economic opportunity for Mexican trucking companies by keeping its borders closed to most carriers.

“If the U.S. Complies with its NAFTA obligations, it would open up a huge market for Mexican carriers to utilize their competitive advantage,” the association stated in its 2009 notice of arbitration.

- See more at: http://gobytrucknews.com/no-lawsuit-from-mexico/123#sthash.611u7fXT.dpuf

 

 

 

Posted in Uncategorized | Leave a comment

REVERSE C-TPAT

EXPORT

 

 

U.S. Customs and Border Protection soon may issue a proposed rule on a new cargo security program for exports that could create headaches for agricultural exporters.

Begun in late 2001, the Customs-Trade Partnership Against Terrorism was initially implemented in response to a Congressional mandate after the Sept. 11, 2001 terror attack that the U.S. should have advance notice on what the U.S. imports and exports.

The focus was first on imports. From only a handful of companies participating in 2001, the U.S. Customs and Border Protection agency now reports more than 10,000 companies accounting for more than 50% of imported goods are voluntarily participating in CTPAT. Participation in the program is supposed to result in expedited arrivals and fewer intensive examinations.

Now CBP is looking to create a similar supply chain security CTPAT program for exports, but Peter Friedmann, executive director of the Washington, D.C.-based Agriculture Transportation Coalition, said the agency has much to learn about agriculture exports.

“There are a couple of problems,” he said. “Customs has almost 300 years experience with imports, but they have no experience with exports,” he said. While two weeks advance notice for imports may work because a vessel can be en route that long from South America, two weeks advance notice of shipments won’t work for U.S. exports like citrus, raspberries, strawberries, broccoli and other perishable commodities.

Friedmann said another issue is that agricultural exports are in production facilities and fields that can’t be surrounded with chain link fences. Customs officials have had some difficulty understanding that the same safeguards in place at a factory won’t work for a field of potatoes.

He said CBP has an advisory committee but so far the committee has primarily been composed of industrial exporters, with no representation from agriculture or the forest product sector.

“We are working, with some of the freight forwarder organizations, to help advise Customs as to the reality of the export supply chain,” Friedmann said. He said the CPB’s proposed rule on export cargo security is expected to appear soon and industry wants to make sure any new regulation does not hinder exports.

In response to U.S. regulation of imports, other countries also have begun to require advance shipping information from U.S. exporters. The list of those countries includes China, the European Union and Japan, Friedmann said.

Japan’s regulations require that, 24 hours before a ship departs the U.S., the shipping line has to electronically transmit all the U.S. export data to Japanese authorities, including the cargo seller, the Japanese buyer, the destination of the shipment and other details.

Shipping lines want the information from exporters even earlier so they won’t have to disrupt their cargo plan if Japan rejects a shipment.

That’s already a strain on perishable exporters, he said, and adding a CTPAT secure supply chain program for exports may prove damaging, he said.

There has never been a known instance where U.S. agriculture exports have created a security risk to other countries, Friedmann said.

The benefits of participation in the export security program are unclear, he said.

“What they are now selling to us is that if you are CTPAT certified, these other countries like Japan, China and European Union will respect that and give you expedited inflow into those countries,” he said.

That message has not yet come from those countries, however, he said.

Friedmann said the regulation on exports could perhaps be the greatest impediment to achieving President Obama’s objective of doubling exports, adding the CBP needs to enhance efforts to understand exports and reach out to the trade and understand agriculture and forest product exports.

The Agriculture Transportation Coalition’s annual meeting on June 25-27 in San Francisco will feature U.S. Customs and Border Protection officials talking about the program. An agenda for the meeting can be found at the group’s website.

 

- See more at: http://www.thepacker.com/fruit-vegetable-news/Export-security-program-could-trip-exporters-254586761.html?view=all#sthash.w2O43Kej.dpuf

Posted in BORDER INSPECTIONS, C-TPAT, Cargo Inspections, Department of Commerce, DHS.GOV, Export Compliance, Mexico trade, National Security, SECURITY | Tagged , , , , , , , , , | Leave a comment

C-TPAT UPDATED INFORMATION FOR 2014

C-TPAT DATA

Posted in Uncategorized | Leave a comment

CBP TO EXPAND AND ADD 2000 JOB TO EXPEDITE TRAFFIC FLOW

USA/Mexico Border Crossing

USA/Mexico Border Crossing

Wednesday, April 02, 2014
Sandler, Travis & Rosenberg Trade Report

U.S. Customs and Border Protection announced March 31 two steps aimed at further improving security and service levels at U.S. ports of entry.

First, CBP is accepting through April 30 applications for new public-private partnership agreements that will allow private reimbursement for enhanced CBP services, including those related to customs and immigration inspections. CBP signed five such agreements in 2013 with ports in Houston, Dallas, El Paso, South Texas and Miami. CBP has now established a Reimbursable Services and Donations Acceptance authority to further facilitate these partnerships, which are not to exceed five years.

Second, CBP has allocated 2,000 additional officers among 44 ports in 18 states to reduce wait times and help speed the flow of lawful goods and travelers into the U.S. Among the cities that will see an increase in personnel at their local ports are New York, Los Angeles, Detroit, Buffalo, Houston, Dallas, Chicago, Las Vegas, Laredo, Nogales and New Orleans.

Posted in BORDER INSPECTIONS, Border news and updates, C-TPAT, Centers of Excellence and Expertise, Customhouse Brokers, DEPARTMENT OF HOMELAND SECURITY, IMPORTS, INLAND PORTS, Laredo, Mexican Trucks, MEXICO MANUFACTURING, Mexico trade, NAFTA, National Security, SECURITY, WWW.DHS.COM | Tagged , , , , , , , , , , , , , , , , , , , , , | Leave a comment

DHS CHIEF VISITS MEXICO PRESIDENT PENA

Published on Sunday, 23 March 2014 14:53
Written by Border Scope

Mexico City, Mexico – Secretary of Homeland Security Jeh Johnson Thursday wrapped up a two-day trip to Mexico where he met with Mexican President Enrique Peña Nieto and senior Mexican officials to discuss the ongoing partnership and cooperation between the United States and Mexico to ensure a safe and secure border region, which is critical to both nations’ economic competitiveness and national security.

Earlier, Secretary Johnson joined Secretary of Finance and Public Credit Luis Videgaray Caso to sign the Declaration of Principles Concerning Bilateral Strategic Plan Initiatives, which provides a guiding framework under which both nations can discuss and implement binational programs and initiatives related to customs, trade facilitation, and the sharing of information.

“The Declaration of Principles we signed today reaffirms the shared commitment of the United States and Mexico to collaborate on security matters and to continue to promote the economic growth and prosperity essential to both of our nations,” said Secretary Johnson. “As we know, effective customs partnership is the linchpin in our nations’ efforts in increasing security and economic prosperity. This Declaration of Principles is built on the doctrines of shared responsibility and joint border management which underlie our engagement.  And it recognizes that security and facilitation are mutually reinforcing objectives.”

During his trip, Secretary Johnson also met with Secretary of Interior Miguel Ángel Osorio Chong, Secretary of Foreign Affairs José Antonio Meade Kuribreña, and Attorney General Jesús Murillo Karam.

Yesterday, Secretary Johnson delivered keynote remarks to the Mexican Business Council for Foreign Trade, Investment, and Technology, highlighting the Department of Homeland Security’s (DHS) efforts to facilitate lawful trade between the United States and Mexico, while maintaining the highest standards of security and combating transnational crime.

During his remarks, Secretary Johnson highlighted an example of this collaboration through the support for each nation’s respective trusted shipper programs, including U.S. Customs and Border Protection’s Customs-Trade Partnership Against Terrorism (C-TPAT) and Mexico’s New Scheme of Certified Companies. C-TPAT is a voluntary public-private sector partnership program that strengthens cargo security throughout the international supply chain by working closely with importers, carriers, consolidators, licensed customs brokers, and manufacturers. Pentagon Holds Event Marking Gay Pride Month

Posted in AUTOMOTIVE INDUSTRY, BORDER INSPECTIONS, CBP, DEPARTMENT OF HOMELAND SECURITY, IMPORTS, INLAND PORTS, MEXICO MANUFACTURING, Mexico trade, NAFTA, National Security, SECURITY | Tagged , , , , , , , , , , | Leave a comment

PREDICTIONS FOR CUSTOMS AND BORDER PROTECTION FOR 2014

CBP LOOKING TO INCREASE THE ROLE OF THE CHB

 Contributor

From Logistics and Transportation

logistics, international trade and supply-chain management

10 Predictions for U.S. Customs and Border Protection in 2014

 

Big changes are underway at U.S. Customs and Border Protection (CPB), which appears to be shifting from a single-minded focus on fighting terrorism to one that includes regulating trade.

That’s the view of Florida attorney Peter Quinter, who chairs the Customs & International Trade Law Group of GrayRobinson, P.A. He has come up with a list of 10 predictions about where CPB is headed — and, consequently, what importers and exporters need to be concerned about — in the year ahead.

1. His first — that CBP will get a new, permanent commissioner — is already well on its way to being fulfilled. Following up on a promise made last summer, President Obama has nominated Richard Gil Kerlikowske for that post. He should bring some much-needed continuity to the agency, which has seen a series of acting heads over the past several years.The former U.S. drug czar — Kerlikowske directed the Office of National Drug Control Policy – has promised to focus on a number of initiatives aimed at streamlining the flow and inspection of imports and exports. Quinter said the appointment reflects a shift in CBP’s mission, one that balances trade enforcement with antiterrorism efforts. The Senate held a friendly confirmation hearing on January 15.

2. Despite continuing battles over federal spending and sequestration, CBP will get a big budget increase. The agency’s budget for fiscal 2014 was $12.9 billion, up 6.5% over the prior year. Expect it to go even higher in FY2015. Quinter said the funding direction has been up ever since 2003, when Customs became part of the Department of Homeland Security and took on responsibility for immigration enforcement as well. “It’s been more planes, guns, boats, people and equipment,” he said.

3. The “do-nothing” Congress will pass a Customs reform bill, which has been around in one form or another for at least seven years. The measure will underscore the agency’s new direction of regulating trade. Quinter predicted that customs inspectors will spend less time stopping and frisking individuals, and more on examining merchandise in containers. The change will make it even more imperative that traders, brokers and carriers join the Customs-Trade Partnership Against Terrorism (C-TPAT), a “voluntary” program which grants expedited processing to participants. It is now being expanded to include foreign companies, Quinter said.

4. As part of a return to its original mission, CBP will perform a record number of importer audits, aimed at companies attempting to avoid payment of antidumping duties. And don’t think you’re in the clear if you hear nothing right away — the agency has five years in which to audit paperwork on goods flowing into the country. What’s more, said Quinter, an audit almost always results in the finding of a violation, and payment by the importer.

5. The U.S. will continue to crack down onintellectual property violations. CBP will place a high priority on examining and seizing imported counterfeit merchandise. Whether that effort will have any effect on rampant violations in China is another question. Quinter said it’s getting tougher to buy counterfeit merchandise on the street in China, but reports suggest that plenty of sellers still hawk fake merchandise behind closed doors.

6. CBP will place more officers in U.S. embassies and consulates, to smoke out counterfeit goods and narcotics destined for the U.S. Customs will step up inspection of containers before they’re loaded aboard ship. “Why wait until the container comes here?” asked Quinter. Few people are aware of the extensive role that U.S. agents play in fighting narcotics trafficking in other countries, he added.

7. The U.S. Government Accountability Office will issue yet another critical report about CBP’s system for selecting the cargoes that should be considered high-risk, and flagged for inspection. GAO doesn’t believe Customs has proved that it knows which shipments to examine for drugs, counterfeit goods or nuclear materials. “I don’t think the targeting systems are very good,” said Quinter, “and they’re not getting any better.” CBP’s methods are far more random than the agency claims, he said.

8. A record number of licensed customs brokers will be counseled by CBP’sBroker Management Offices around the country — and assessed penaltiesfor various violations of the law. Customs and other government agencies are demanding an “overwhelming” amount of information from brokers today, and errors are rampant. A counseling session might be limited to a meeting with a CBP import specialist. Or it could result in a penalty of $30,000 per violation and even revocation of a broker’s license. You can thank the burgeoning CBP budget for the extra staff that makes the program possible.

9. C-TPAT will expand its membership categories to include warehouses and trucking companies. Currently the program is restricted to importers, airlines, railroads, ocean carriers, customs brokers, third-party logistics providers and port authorities. Beyond that, CBP will likely extend membership to exporters shipping to the U.S., said Quinter.

10. CBP employees will see a significant bump in pay, having been forced to accept “insultingly low” increases over the past few years. Previous raises haven’t even kept pace with inflation. A decent increase, Quinter said, would be at least 3% to 5%, given the current low inflation rate. The likely result is more motivated Customs officers — and a need for importers and exporters to be even more vigilant about complying with an ever-expanding body of

Posted in BORDER INSPECTIONS, Border news and updates, C-TPAT, Cargo Inspections, CARGO THEFT, CBP, CEE, Centers of Excellence and Expertise, Customhouse Brokers, DEPARTMENT OF HOMELAND SECURITY, INBONDS, INLAND PORTS, NAFTA, WWW.DHS.COM | Tagged , , , , , , | Leave a comment

NAFTA EFFECTS AS WE LOOK BACK 20 YEARS

 

By Gary FeuerbergEpoch Times | March 11, 2014

 

 

WASHINGTON—The importance of Mexico to the United States is evident in our debates on immigration reform and free-trade agreements. As 10 percent of the U.S. population is of Mexican origin, it was almost inevitable that our neighbor to the south would play a vital role in the nation’s social and political consciousness. Emotions run high regarding immigration reform, border security, and trade.

The bilateral trade relationship was the focus of a forum on Feb. 27, where two leading experts on Mexico vigorously defended the North American Free Trade Agreement’s (NAFTA) impact on the economies of Mexico and the United States, wanting to see work begin in earnest for the next phase.

The forum was held under the auspices of NDN, a think tank and advocacy organization based in Washington, D.C., whose major areas of study include programs looking at globalization, macro-economic policy, and Latin America.

It has been 20 years since NAFTA went into effect in 1994, and both supporters and critics agree that the period has seen massive changes—some good, some bad—in both countries. It has become a controversial issue in the debate over free trade agreements with Asian and European countries, which are now under negotiation.

No one can deny the growth of our bilateral trade with Mexico, although many dispute whether it has been a net gain for American workers. Mexico has become our second-largest export market, behind Canada and ahead of China. Mexico is our third-largest trade partner in imports, after China and Canada, according to U.S. Census Bureau data cited by an NDN backgrounder document.

President Barack Obama has made five trips to Mexico in his presidency, with the most recent on Feb. 19 to a meeting with Mexican president Enrique Peña Nieto in the industrial city of Toluca, about 40 miles from Mexico City. The other member country in the trilateral relationship, Canada, was represented at the Toluca meeting by Prime Minister Stephen Harper.

In early February, U.S. Secretary of Commerce Penny Pritzker chose Mexico for her first trade mission, traveling to Monterrey and Mexico City. Accompanying Pritzker were representatives from 17 major U.S. businesses, according to NDN.

“[Mexico] is clearly a priority for the [Obama] administration,” said Eric Farnsworth, vice president of the Council of the Americas and Americas Society, at the forum.

Opposition to NAFTA at Home

The host of the forum, Nelson Cunningham, noted that Obama, in his speech and answers to press questions at Toluca, never uttered the word “NAFTA.” Cunningham is president and a co-founder of McLarty Associates and in 1998, served in the White House as special advisor to President Clinton on Western Hemisphere Affairs.

The president is undoubtedly aware that public opinion polls show that NAFTA and similar free-trade agreements are unpopular, even among his own party. An Angus Reid Public Opinion poll conducted online in May 2012 found that only 15 percent of Americans believe that the United States should continue to be a member of NAFTA under the current terms, and 53 percent said that the United States should either do whatever is necessary to leave NAFTA or renegotiate the terms.

Only 15 percent of poll participants want to continue with NAFTA as it is, only one-third (34 percent) said that NAFTA has benefited the American economy, and still less (25 percent) think it has benefited workers.

Currently the administration is fighting hard for a new free-trade agreement with 12 Pacific nations called the Trans-Pacific Partnership (TPP), in which Mexico and Canada are included. The TPP would expand the scope of NAFTA.

Last month, Public Citizen published a comprehensive report, written by research director Ben Beachy, highly critical of NAFTA. It stated: “Millions have suffered job loss, wage stagnation, and economic instability from NAFTA. Scores of environmental, health, and other public interest policies have been challenged. Consumer safeguards, including key food safety protections, have been rolled back.”

This forum only considered the alleged job loss.

NAFTA Advocacy

One of most vocal proponents of NAFTA is Shannon O’Neil, senior fellow for Latin America Studies at the Council on Foreign Relations and author of “Two Nations Indivisible: Mexico, the United States, and the Road Ahead” (Oxford University Press, 2013).

“If you look at any serious economic studies of what NAFTA has [done], there are widespread benefits and there are very concentrated losses,” O’Neil said at the forum.

O’Neil asked the question of where the United States would be in the absence of this agreement.

“Would we still see today if we had not signed: apparel made in rural Massachusetts, carpets in the Carolinas, or drill bits in Cleveland, Ohio? … The answer is ‘no,’ because all these things today are made in China with whom we do not have a free-trade agreement,” she said.

Ronald Brownstein, editorial director at Atlantic Media, wrote in the National Journal on Feb. 20: “In a relentlessly globalizing world, most jobs that moved to Mexico since NAFTA would likely have shifted to some lower wage country.”

O’Neil had more to say about if NAFTA had never come to be.

“Now if we had not signed NAFTA, do you think we would see cars made in Detroit? Airplanes and jets made in Kansas City? Tractors in Peoria, Illinois?” she said. “The answer is probably ‘no.’”

In a recent article in Foreign Policy magazine (Feb. 17), O’Neil stated that the annual intra-regional trade between the United States, Canada, and Mexico is more than $1 trillion, and that 14 million jobs depend on this relationship, which is 5 million more than pre-NAFTA days in 1993.

Like other NAFTA advocates, O’Neil conceded that jobs have been lost, particularly for “the less-educated and lower-skilled workers.” But she said that more jobs have been created because the growth of global trade allowed expansion globally.

The Mexican economy has been transformed by NAFTA. “GDP has more than doubled from $510 billion to $1.178 trillion in 2012,” stated the NDN backgrounder.

Pre-NAFTA, Mexico was a closed economy based on agriculture and commodities, according to O’Neil. Today, it has become an economy of manufacturing and services and “one of the most open commercially,” she said. In addition, it has become a vibrant democracy.

Interconnected Supply Chains

An important point that O’Neil, Farnsworth, and Brownstein made is that for every dollar spent on U.S. imports from Mexico, on average 40 cents originated in the United States. The U.S. share of 40 percent of value with Mexico compares to 25 percent with Canada and only 4 percent with China.


“Of the nearly $277 billion in goods imported from Mexico in 2012, $111 billion was actually made by U.S. workers,” wrote O’Neil. Contrast that with China. Of the $425 billion in imports from China, less than $17 billion was made in America. 

Since the signing of NAFTA, the nature of production has shifted away from finished products, where Canada, Mexico, and the United States have interconnected supply chains, she wrote. More manufacturing in Mexico means more jobs in the United States.

“[NAFTA] has helped the United States to remain competitive globally so that we have regional supply chains that allow us to compete with China [and others],” said O’Neil. “That fundamentally is what NAFTA has done.”

Posted in IMPORTS, MEXICO MANUFACTURING, Mexico trade, NAFTA | Tagged , , , , , , | Leave a comment

CHINA AND MEXICO BEGIN GOOD TRADE RELATIONS

ONLY 3% OF WHAT IS BOUGHT IN THE USA IN MADE IN CHINA

MEXICO CITY, Feb. 11 – The relationship between China and Mexico is at its bestmoment in history, Chinese Ambassador to Mexico Qiu Xiaoqi said Tuesday.

In Latin America, Mexico is a major partner to China in the political and commercial fields,Qiu said in an interview with Xinhua

On Feb. 14, 1972, the two countries established diplomatic ties with bilateral trade totalling13 million U.S. dollars that year, recalled Qiu, adding bilateral trade value reached 40billion dollars in 2013.

At present, the strong bond between Chinese President Xi Jinping and Mexican PresidentEnrique Pena Nieto facilitates the development of bilateral cooperation in various fields,said the ambassador.

“The two presidents signed a series of agreements and major deals to promote trade andinvestment between both sides.”

The commercial area stands out in bilateral relations, said the Chinese ambassador, addinghe hopes other areas such as tourism would be promoted in the future.

“Mexico is one of the most important tourist destinations for Chinese citizens. We nowneed to work together to remove some obstacles in procedures, creating moreopportunities in the processing of visas for travelers, which will benefit Mexico and China,”he said.

China and Mexico signed a very important agreement in June 2013 to export to Chinatequila, which is a very typical and wonderful drink of Mexico, he said.

Investments between China and Mexico will grow rapidly in the following years as bothcountries are working hard to establish a working group to promote investment andbilateral cooperation in such fields as energy, finance, infrastructure and natural resources.

“I visited many states in order to promote Chinese investment in Mexico and Mexicaninvestment in China,” said Qiu.

As the anniversary of the establishment of diplomatic relations between the two countriesis approaching, “we have to work harder to strengthen our relations and cooperation,” theambassador added.

(Editor:DuMingming、Yan Meng)
Posted in China, Country of Origin labeling, Customhouse Brokers, IMPORTS, Mexican economy., Mexican Imports, Mexican peso, MEXICO MANUFACTURING, Mexico trade, trade | Tagged , , , , , | Leave a comment

NAFTA 20 YEARS OLD

NAFTA SURFACE TRADE CLIMBED IN 2011

NAFTA’S 20TH BIRTHDAY

 

Sergio Munoz Bata is a syndicated Latin American columnist whose articles appear in 18 papers in 11 countries. He has been Executive Editor of La Opinion, the largest Spanish language newspaper, as well as a member of the Los Angeles Times editorial board.

 

 

Barack Obama’s position on free trade agreements is anything but clear. As a senator, he was one of the most outspoken opponents of the pact with Mexico and Canada but voted in favor of a free-trade agreement with Peru, which was modeled after NAFTA. He then voted against CAFTA, a free trade agreement with five tiny Central American countries and the Dominican Republic. Now, he’s asking Congress for fast track trade approval for two trade agreements, one with Pacific Rim countries and another with the European Union. The fact that Sen. Harry Reid of Nevada, the majority leader, immediately came out against the idea makes you wonder if Obama really wants the two trade agreements.

Obama’s hesitations remind me of the doubts Carlos Salinas de Gortari had about free trade when he was running for the Mexican presidency. I asked him if he agreed with Ronald Reagan’s vision of a common market and would enter into negotiations with the U.S. His answer said it all: “Do you want them to eat us alive?” I had raised the question at a campaign stop in Guadalajara in 1987, at a time when Salinas feared the asymmetry between the two countries was an insurmountable problem.

Three years later when I met again with Salinas in Washington, the doubts had disappeared. He had quickly learned that the fastest way to get people to invest in Mexico was to lure them with business in the United States via Mexico, and he was deeply engaged in negotiations with the George H. W. Bush Administration. Twenty years after the treaty with the United States and Canada was signed, we know that the bigger fish did not swallow the smaller, that trade between the three countries has tripled to more than $1 trillion a year and their integration has created a $19 trillion regional market with some 470 million consumers.

Thomas “Mack” McLarty, the former White House Chief of Staff for President Bill Clinton thinks the political climate in the U.S. is ripe for a new trade agreement: “I believe the odds are good. I say that because, despite ongoing partisan debates in Washington, American citizens already recognize the benefits and importance of economic engagement abroad.” He noted a recent Pew Research Center-CFR poll found that 77 percent of respondents feel increasing trade and business ties with the rest of the world benefit the United States. There is a solid reason for that, says Dr. Luis de la Calle, a member of the Mexican team that negotiated NAFTA and other trade agreements with Latin American countries, Europe, Israel and Japan.

“NAFTA has had a positive impact on the three countries,” said de la Calle. “Trade and investment volumes are higher than originally expected and the agreement has been fully implemented with few exceptions, such as trucking where the U.S. has not complied one hundred percent.”

“Canada and Mexico have become much more stable economies, in part thanks to the NAFTA,” he added. “Consumers have benefited in the three countries, but more in Mexico, which had a more protectionist economy before NAFTA.”

Furthermore, the elimination of tariffs and other trade barriers has allowed Mexico’s export industry to soar from about $60 billion in 1994 to nearly $400 billion annually in 2013. Mexico, considered a leading emerging market in the world, is now exporting an array of manufactured goods ranging from automobiles and refrigerators to cellular telephones. In 2009, Mexico was the largest exporter of flatscreen TVs in the world.

Of course, NAFTA has not been the panacea that its proponents promised. Throughout these years, it has not been a fundamental factor in the activation of the Mexican economy, neither has it been an important source of job creation. And while export jobs pay better wages, NAFTA has not uplifted the wages of other workers.

Above all, it has failed to stop illegal immigration to the U.S. But neither did it create the “giant sucking sound” of jobs that the ineffable Ross Perot and the unions and their spokesperson predicted to scare Americans. Indeed, the creation or reduction of employment in the three countries has had little to do with NAFTA. Contrary to the predictions of a sector of the Mexican left, America has not abused its power to impose conditions. In fact, it is amazing that in his twenty years of operation, there have been so few disputes and those that have arisen have been resolved in a civilized manner using the very mechanisms produced by the treaty. Among the benefits of the treaty there is one that stands out: the Mexicans lost their fear to negotiate with the neighbor to the North and the rest of the world. After NAFTA, Mexico has signed 12 free trade agreements with 44 countries and has now been invited by President Obama to enter into partnership with eight countries in the Pacific Basin through the Trans-Pacific Partnership, or TPP.

In November 1990, President Salinas told me the negotiations were at a very difficult stage because President Bush insisted that oil should be included in the negotiations while Salinas advocated that the free movement of persons was included. Finally, in Monterrey, Mexico they agreed that neither of the two topics was to be included in the draft. Both were nonstarters with their respective congresses.

Today, things have changed and it would be wise to include the countries of the Pacific Rim in the negotiations of the transatlantic alliance. Given the recent passage of the energy reform that will allow foreign private investment in the hitherto monopolistic oil industry, Mexico would be a very attractive partner of the U.S., the countries of the Pacific Rim and of the Transatlantic Alliance. It would be extraordinary if the taboo topic of the free movement of people in the Northern Hemisphere could be addressed with the same ease with which they can talk about energy exchanges.

Neither McLarty nor de la Calle believes the oil and migration mix would work.

“Forging or deepening these trade pacts do not need to specifically include a focus on energy and immigration, as these could weigh down potential agreements or even block their successful ratification,” says McLarty.

“Mexico should proceed with its energy reform only if it makes sense to do it unilaterally. Conditioning the reforms to other issues, such as migration, sends the message that it is worth doing only as a concession,” says de la Calle.

Still, Mexico should use every lever it has in its power to pursue a separate agreement to make the life of its people living in the United States less unpredictable and more secure. A little more than twenty years ago, NAFTA was just a daring idea that came true because a small group of people believed in it. We should keep on dreaming on the immigration front.

Posted in AUTOMOTIVE INDUSTRY, Border news and updates, Customhouse Brokers, IMPORTS, INLAND PORTS, Laredo, Mexican economy., Mexican Imports, Mexican peso, Mexico trade, NAFTA, trade | Tagged , , , , , , , | Leave a comment

TRANSPORTATION ASPECT OF FDA FSMA TO SOON TAKE EFFECT

TRUCKS WAIT FOR NEW FDA LAWS TO TAKE EFFECT

TRUCKS WAIT FOR NEW FDA LAWS TO TAKE EFFECT

 

The Food and Drug Administration issued Jan. 31 a proposed rule designed to prevent the contamination of human and animal food during transportation by motor or rail vehicles. According to the FDA, the goal of this rule is to prevent practices that create food safety risks, such as improperly refrigerating food, inadequately cleaning vehicles between loads and failing to properly protect food during transportation, by establishing requirements for the following.

- the design and maintenance of vehicles and transportation equipment to ensure that they do not cause the food transported to become contaminated

- the measures taken during transportation to ensure food is not contaminated, such as adequate temperature controls and separation of food from non-food items in the same load

- procedures for exchange of information about prior cargos, cleaning of transportation equipment, and temperature control between the shipper, carrier and receiver, as appropriate to the situation

- training of carrier personnel in sanitary transportation practices and documentation of the training

- maintenance of written procedures and records by carriers and shippers related to transportation equipment cleaning, prior cargos and temperature control

- procedures by which the FDA will waive any of these requirements if it determines that the waiver will not result in the transportation of food under conditions that would be unsafe for human or animal health and that it is in the public interest

With some exceptions, this proposed rule would apply to shippers, receivers and carriers who transport food in the U.S. by motor or rail vehicle, whether or not the food is offered for or enters interstate commerce. It would also apply to a person outside the U.S., such as an exporter, who ships food to the U.S. in an international freight container by oceangoing vessel or in an air freight container and arranges for the transfer of the intact container in the U.S. onto a motor vehicle or rail vehicle for transportation in U.S. commerce, provided that the food will be consumed or distributed in the U.S. The rule would not apply to the transportation of fully packaged shelf-stable foods, live food animals, and raw agricultural commodities when transported by farms.

Small businesses (businesses other than motor carriers who are not also shippers and/or receivers employing fewer than 500 persons, and motor carriers having less than $25.5 million in annual receipts) would have two years after the publication of a final rule to comply, while other businesses would have one year. The proposed rule would not cover shippers, receivers or carriers engaged in food transportation operations that have less than $500,000 in total annual sales.

Comments on this proposal are due no later than May 31. The FDA is also planning on holding three public meetings concerning this rule: Feb. 27 in Chicago and March 13 in Anaheim, Calif. (by extending meetings already scheduled to discuss a proposed rule on the intentional adulteration of food) and March 20 in College Park, Md.

Posted in Border news and updates, Canadian truckers, FDA, FOOD SAFETY, FOOD SAFETY MODERNIZATION ACT, FOREIGN SUPPLIERS VERIFICATION PROGRAM, FSMA, IMPORTS, Laredo, Mexican tomatoes, Mexican Trucks, Mexico trade, Stevens Transport, SUPPLY CHAIN | Tagged , , , , , , , , , , | Leave a comment