Mexico eyes ‘mutually satisfactory’ solution to U.S. energy trade spat -deputy minister

• Mexico’s Deputy Economy Minister Luz Maria de la Mora hopes for a “mutually satisfactory solution” to talks requested by the US and Canada over what they claim are Mexican energy-related breaches of a regional trade pact.
• If unresolved, the dispute could lead to punitive tariffs in the United States.
• Mexico will not use the energy dispute with the US as a bargaining chip, Economy Minister Ildefrica de la Mora said. The United States has requested consultations on Mexico’s energy policies under the new US-Mexico-Canada (USMCA) agreement.

MEXICO CITY, July 22 (Reuters) – The Mexican government has issued a statement condemning the use of the term “terrorism” According to Reuters, Mexico’s Deputy Economy Minister Luz Maria de la Mora hopes for a “mutually satisfactory solution” to talks requested by the US and Canada over what they claim are Mexican energy-related breaches of a regional trade pact.

The demands from the United States and Canada follow years of concern among those countries’ private firms that Mexican President Andres Manuel Lopez Obrador’s push to tighten the state’s grip on the oil and power sectors treated them unfairly and violated the United States-Mexico-Canada Agreement (USMCA).

“We want to use this consultation phase… to see how we can reach a mutually satisfactory solution through an open, frank, and constructive dialogue that will allow us to overcome these differences,” De la Mora said in an interview with Reuters.

The request for consultations is the most serious trade dispute between Washington and Mexico City since the USMCA trade pact went into effect two years ago, and if unresolved, could lead to punitive tariffs in the United States.

Though De la Mora stated that Mexico’s government would seek to argue that its energy policies do not violate the trade agreement, her conciliatory tone about finding a solution that benefits all parties contrasts with Lopez Obrador’s defiant response to the complaints. more info

The leftist energy nationalist has promised to resurrect state-owned oil producer Petroleos Mexicanos (Pemex) and power utility Comision Federal de Electricidad (CFE), which he claims his predecessors “destroyed” in order to hand over Mexico’s energy market to foreigners.

The US Trade Representative claims that efforts to strengthen state-owned enterprises have harmed American companies in Mexico.

Mexico, according to De la Mora, will not use a separate trade dispute with Washington over the auto industry as a bargaining chip.

“We hope this issue will be resolved before the end of the year, and we are very optimistic that we have a very strong case and that we will have a favourable resolution for Mexico,” De la Mora said, referring to the auto dispute, which includes disagreements over proposed U.S. tax breaks for electric vehicle manufacturing.

Also Read

Satellite imagery, ship data indicates path of Russian vessel Kyiv says shipped “looted” grain

A Russian-flagged cargo ship carrying corn docked in the Turkish port of...

Canada announced in January that it would join Mexico in requesting a dispute resolution panel to resolve their disagreements with the US over how to apply the treaty’s automotive sector content requirements. more info

When asked if Lopez Obrador’s energy policies were discouraging investment, De la Mora pointed to recent announcements of investments in Mexico by Sempra Energy (SRE.N) of the United States and TC Energy of Canada.

She argued that the USMCA’s dispute resolution mechanism provided investors with certainty because if disagreements arose, as they do now, its use would assist in resolving them.

“The dispute resolution mechanism is a very solid mechanism; it provides greater certainty to investors, which is very positive for the business climate,” she said.

On July 20, the United States requested consultations under the USMCA regarding Mexico’s energy policies.

Under USMCA rules, the US and Mexico must hold consultations within 30 days of the US request, unless the parties agree otherwise. If they do not resolve the matter through consultations within 75 days of the United States’ request, the US may request the formation of a dispute panel.

Also Read

Along Ukraine front, the villagers who didn’t leave are ghosts in the wasteland

The village of Mala Tokmachka is located in Ukrainian-held territory. It is...