[CTC_TRADE] Senators: TPP is Opportunity to Chart a New Course

[Citizens Trade Campaign]

MARCH 10, 2010 


Mexico Tops List of Trade Issues Facing White House 


By MEENA THIRUVENGADAM
<http://online.wsj.com/search/search_center.html?KEYWORDS=MEENA+THIRUVEN
GADAM&ARTICLESEARCHQUERY_PARSER=bylineAND>  And HENRY J. PULIZZI
<http://online.wsj.com/search/search_center.html?KEYWORDS=HENRY+J.+PULIZ
ZI&ARTICLESEARCHQUERY_PARSER=bylineAND>  


WASHINGTON-The Obama Administration's top trade negotiator said the U.S.
was working quickly to resolve a damaging trade spat with Mexico, one of
several obstacles to the president's goal of doubling U.S. exports
within five years.

"We understand the sense of urgency," said U.S. Trade Representative Ron
Kirk after a speech at the National Press Club. 

He didn't specify what measures the White House was taking to resolve
the Mexico issue.

Business groups warned Tuesday that U.S. companies hurt by punitive
tariffs imposed by Mexico a year ago are at risk of having to lay off
thousands of workers unless the dispute is resolved soon. 

"The current situation is unsustainable," said John Murphy, vice
president of International Policy at the U.S. Chamber of Commerce.

"We can't wait and wait and wait," he said. "On trade, when we stand
still we fall behind." 

A bipartisan group of lawmakers has also called on the administration to
act, citing job losses in their states.

The White House has set a goal of adding two million jobs to the economy
by doubling exports. President Barack Obama is expected to focus on
trade during a speech Thursday at the U.S. Export-Import Bank's 2010
annual conference.

But the administration faces a lengthy list of trade issues-and
opposition to trade-opening deals from congressional Democrats and
labor-union allies.

In addition to the Mexico dispute, the White House has 30 days to
negotiate a deal with Brazil to avoid retaliatory tariffs on about 100
U.S. products, including cars, cotton and certain agricultural items.

Free-trade agreements with South Korea, Colombia and Panama remain
stalled in the Senate several years after they were introduced by the
Bush administration. And Mr. Kirk said it was unlikely that the Doha
round of global trade-opening talks would come to fruition this year. 

Separately, Mr. Kirk said the U.S. was continuing to study whether to
make an appeal to the World Trade Organization challenging China's
Internet censorship practices. 

Some business groups consider the Mexican trade dispute the most acute
issue for U.S. businesses and farmers.

The root of the clash is Congress's move in 2009, backed by the
Teamsters union, to cancel a pilot program launched in 2007 that allowed
Mexican trucks to travel into the U.S. beyond the commercial border
zone. The program was aimed at satisfying a component of the North
American Free Trade agreement. 

Mexico retaliated by slapping $2.4 billion of tariffs on a range of U.S.
manufactured and agricultural products, saying the U.S. action violated
the North American Free Trade Agreement.

The funding restriction that killed the pilot program is not present in
the government's 2011 budget proposal, a development with which Mr. Kirk
said he was "most pleased." 

A coalition of groups led by the U.S. Chamber of Commerce and the
National Association of Manufacturers said Tuesday that the Mexican
tariffs have caused $2.6 billion in lost exports and more than 25,000
lost jobs.

U.S. companies exported about $129 billion in goods and services to
Mexico in 2009, making Mexico among the top U.S. markets.

Companies that have borne the cost of the tariffs without raising
prices, in a bid to maintain sales in Mexico, can't keep doing so for
much longer, said Doug Goudie, NAM's director of international trade
policy.

"This will take pain from the bottom line to the unemployment line," he
said.

Write to Meena Thiruvengadam at meena.thiruvengadam at dowjones.com and
Henry J. Pulizzi at henry.pulizzi at dowjones.com 

 

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