US-Mexico trade relations in focus

Michael Shifter interviewed by CGTN CGTN / YouTube

CGTN’s Roee Ruttenberg spoke with Michael Shifter, president of Inter-American Dialogue, about US-Mexico trade relations after Andrés Manuel Lopez Obrador visited the United States for a meeting with President Donald Trump.

Comments by Michael Shifter: 

“There are minor differences [between NAFTA and USMCA]. Essentially, [USMCA] is dressed up to show that it is a new deal, but most experts who analyzed the technical details see that it’s very similar to NAFTA. There are some changes to some of the rules of origin, some of the labor provisions, obviously it has been updated for the digital economy since NAFTA came together in the 1990s when we were not thinking of the digital factor,[…] but it is not so different from NAFTA.”

“This new deal has a lot more monitoring of protection of labor rights in Mexico, and that was a demand the Democrats had in order to get Democratic support for this in Congress. That is not something that the Mexican government really likes. The US was looking for a different sunset clause so that this wouldn’t be as long as the Mexicans wanted it. The sunset close is now 16 years and they wanted a shorter sunset clause. So there were some things on the margins that each of the governments were not happy with but essentially there were not huge differences from the previous trade agreement.”    

“The polls show that the Mexicans have a favorable view towards this deal. The big mistake with NAFTA, and I hope it is not repeated with this deal, is to oversell it. This is a trade deal, trade did increase significantly after NAFTA, trade will continue with this deal, but it is not going to resolve the fundamental economic problems in Mexico. Mexico, according to the IMF, is going to shrink by 10.5%. There are profound problems that have been exacerbated by the pandemic, and nobody should have any illusions that this is going to solve those problems. For that, you need different policies on investment and other issues that we haven’t seen yet in the Lopez Obrador government. Still, the polls show that USMCA is favorably viewed by most Mexicans.”

“Most Mexicans think that AMLO should have said more [in his meeting with Trump]. I think this has been part of President Trump’s message, which has been very aggressive towards Mexican immigrants and also Mexico since he announced his candidacy for the presidency five years ago, and I think many Mexicans feel offended. It is interesting that the polls show that the Mexican views towards the United States have become more favorable, but President Trump himself is not well-liked in Mexico. […] Because the meeting was so amicable between the two, I think President Trump will use this to his political advantage in this campaign. He is going to exploit this for his political advantage as the campaign moves forward.”

“[Canada’s absence from this meeting] was significant. This is a North American deal, not a US-Mexico deal. Prime Minister Trudeau didn’t come because of the pandemic and because of the fear that the Trump administration is going to put aluminum tariffs on Canada. There is some tension and unease there.”

Watch the full interview here