By MEGGIE I. FOSTER
Assistant Editor INDIANAPOLIS, Ind. — In a big win for U.S. agriculture, U.S. Department of Transportation Secretary Ray LaHood signed an agreement with Mexican officials last week to resolve the long-running dispute regarding Mexican truck access north of the border.
“Today (Wed., July 6) the U.S. Department of Transportation – after months of hard work with Mexican counterparts – closed a deal that will provide tariff relief for numerous U.S. agricultural products and manufactured goods,” said USDA Secretary Tom Vilsack.
According to Vilsack, the U.S.-Mexico trucking dispute has cost U.S. businesses more than $2 billion; and for agriculture, the dispute reduced U.S. farm exports to Mexico by 27 percent.
“But today, thanks to the persistent work of the Obama Administration, we have an agreement that not only will ultimately eliminate punitive tariffs, but it also provides opportunities to increase U.S. exports to Mexico and helps to expand jobs on both sides of the border,” he added. “Moreover, the agreement puts the United States and Mexico on equal footing pertaining to our obligations under the North American Free Trade Agreement, or NAFTA, by authorizing Mexican and U.S. long-haul carriers to engage in cross-border operations subject to certain requirements.”
Officials at the Department of Transportation explained that the new cross-border trucking program will begin a phased-in program on July 8, when Mexico officials reduced the existing tariffs on U.S. goods by 50 percent. The remaining Mexican tariffs will be lifted when the first Mexican truck is authorized to drive on U.S. roads.
“Potentially, we’re looking at a total lifting of the punitive tariffs in as little as 45 days,” Vilsack explained.
He added that carriers participating in the program are subject to certain requirements which will not allow them to haul domestic cargo between points within the United States.
“For U.S. farmers and ranchers, the lifting of these tariffs means jobs and fiscal relief – lifting constraints on American products, removing barriers to trade with a key trading partner, and putting Americans back to work at a time when U.S. agriculture is setting record export figures,” Vilsack said.
Currently, Mexico ranks as the United States’ third-highest trading partner, purchasing $14.5 billion of U.S. farm goods last year.
Two farm groups weighed in on the announcement last week, contesting that the new agreement is only the first of two important hurdles in resolving the ongoing trade dispute.
“Under NAFTA, Mexico eliminated its tariffs on U.S. beef imports. That gave the United States a competitive advantage. However, if U.S. beef imports were added to the list of tariffed commodities, we would lose market share that would be difficult to regain,” said National Cattlemen’s Beef Assoc. Manager of Legislative Affairs Kent Bacus.
“As we look to expand trade opportunities for U.S. beef around the globe, it is critical that we continue to build the relationship with our neighbors to the South. We are encouraged by the signing of the MOU (memorandum of understanding) and encourage full implementation of the agreement to end the dispute once and for all.”
According to Bacus, the United States exports more beef to Mexico than any other country.
In fact, Mexican consumers purchased $819 million worth of U.S. beef last year alone.
“We cannot afford to jeopardize that relationship,” he said, further requesting that DOT proceed cautiously into the second phase of the program.
American Farm Bureau Federation President Bob Stallman weighed in adding that “it is important that the U.S. live up to its trade agreement obligations under the North American Free Trade Agreement (NAFTA) allowing for the cross-border delivery of international cargo from Mexico into the United States. Any effort by Congress to prohibit this from moving forward will cause Mexico to once again put tariffs in place, putting the burden of non-compliance back on U.S. farmers.”
For details on the agreement, visit www.dot.gov/affairs/2011/dot7911a.html |
