[CTC] Mexican ambassador: Labor reform budget to be determined by September

[Arthur Stamoulis]

Mexican ambassador: Labor reform budget to be determined by September
July 18, 2019 at 6:47 PM, Inside US Trade
Mexican Ambassador to the U.S. Martha Bárcena on Thursday said that a budget to implement labor reform in Mexico will be decided by September -- responding to a key concern flagged by congressional Democrats as they consider whether to support the U.S.-Mexico-Canada Agreement.
Some congressional Democrats and the AFL-CIO -- the largest federation of labor unions in the U.S. -- have said they need to know how Mexico is going to implement its labor reform legislation before they can back USMCA. Part of that is determining what resources will be allocated to that effort. Mexico will determine what its 2020 budget will be for the implementation of labor reform by September, Bárcena said at an event hosted by Congressional Quarterly and the Meridian International Center.
“We say it is very difficult for the Mexican government to give you a comprehensive budget of the labor reform because we do our budget year by year, so we are going to allocate resources to implement the labor reform according to this roadmap, depending on the different activities that we are doing every year,” Bárcena said, referring to a roadmap the Mexican government provided U.S. lawmakers last month.
A delegation of lawmakers is headed to Mexico on Thursday to address labor and environmental concerns with USMCA, among other issues. Rep. Earl Blummenauer (D-OR), the House Ways & Means Committee trade subcommittee chairman, told Inside U.S. Trade on Thursday <https://insidetrade.com/node/166895> that the congressional delegation will be seeking clarity on that roadmap.
Bárcena said the roadmap addresses the “huge challenge of reviewing” 700,000 collective bargaining agreements, some of which are “protection contracts.” Protection contracts are agreements signed between an employer and a union without the consent of the workers.
“What is important to say is that there is the political will” to go through that review process, Bárcena said.
Another question addressed in Mexico’s roadmap is when the country will eliminate conciliation and arbitration boards (CABs), which would help prevent the implementation of protection contracts, and transition “to the conciliation process of the labor courts,” she said.
Democrats don’t trust Trump to enforce USMCA labor provisions
Democrats don’t trust that the Trump administration will enforce USMCA’s labor provisions, Rep. Ron Kind (D-WI) said in an interview with Inside U.S. Trade. Kind co-chairs the New Democrat Coalition’s trade task force and is a member of the House Ways & Means trade subcommittee. He is part of the delegation headed to Mexico this weekend.
The Bureau of International Labor Affairs -- the enforcement division at the Labor Department -- “was seriously underfunded under [President Trump’s] own budget,” he said. “So here they’re asking us to trust this administration to enforce labor provisions in this agreement when they are gutting the very agency that’s in charge of monitoring and enforcing labor provisions. So that doesn’t engender a lot of confidence on our side that this administration is actually serious about labor enforcement that we’ve been calling for."
“Then on the Mexican side, President Andrés Manuel López Obrador has requested a very austere budget which cuts most of the government agencies down there by over 30 percent and the labor reform they just passed is going to require a lot of work and a lot of resources to do right.”
Bárcena defends USMCA’s enforcement provisions
The enforceability of USMCA’s labor and environment provisions is at the center of Democrats’ concerns about the deal. But Bárcena questioned what else beyond the deal’s state-to-state dispute settlement mechanism Democrats needed to see included.
“We have a state-to-state dispute settlement mechanism. What we need to have is the list of arbiters by the time USMCA comes into force so that no panel can be delayed. So, why think of additional enforcement mechanisms if the enforcement mechanism is there,” she said.
Democrats have flagged language in USMCA, lifted from NAFTA, that allows for the blocking of dispute settlement panels as an enforceability issue that must be resolved and plan on addressing <https://insidetrade.com/node/166842> the matter this week in Mexico.
“What’s currently written does not guarantee [panel blocking] won’t happen in the future. That’s what we’re trying to work on -- greater assurance in writing that neither country is capable of not appointing the panel that they’re required to under the agreement,” Kind said.
U.S. Trade Representative Robert Lighthizer has previously suggested Section 301 of the Trade Act of 1974 could be used as an enforcement mechanism for USMCA, but Kind said “there’s not a lot of confidence on just relying on 301 authority” with President Trump, who has been “completely irresponsible in the unilateral actions he has taken and the economic damage that has resulted from it.”
Further, Kind said he thinks “it’s a little unrealistic to expect sovereign nations just to rely on the judgement of the president whether they’re in compliance or not.”
Bárcena said Mexico would not accept any enforceability mechanism that would infringe on Mexico’s sovereign rights.
Lawmakers to raise environmental issues during trip
Lawmakers and Mexican government officials will also discuss environmental concerns with USMCA this week. On Wednesday, a USMCA working group of Democrats met with Lighthizer <https://insidetrade.com/node/166884> to discuss environmental concerns.
Mexican officials have been asking U.S. lawmakers exactly what worries them about the enforcement of the environmental provisions and “some of them really don’t have an answer,” Bárcena said.
One specific environmental issue that has been identified is pollution of Rio Tijuana and Rio Nogales, she said. The rivers form part of the U.S.-Mexico border.
“But we have the tools and the mechanisms” to solve that concern, such as the U.S.-Mexico International Boundary and Water Commission and the North American Development Bank “that can issue loans to specifically solve these environmental problems at the border.” The NADB administers grant funds from the Environmental Protection Agency for water infrastructure projects at the U.S.-Mexico border.
The congressional delegation will be in Tijuana on Sunday to speak with the IBWC, Bárcena said. The U.S. lawmakers will also meet with López Obrador on Friday.
Mexican officials are telling U.S. lawmakers that the two sides should “make a list of the joint priorities and let’s see how we tackle those priorities,” Bárcena said. One priority should include replenishing the NADB so that it can be used to address environmental concerns. The ambassador also suggested a review mechanism of one to two years to track progress made in environmental goals.
Patience wearing thin in talks between Democrats and USTR
Ways & Means Chairman Richard Neal (D-MA) said this week <https://insidetrade.com/node/166884> that Democrats need to get more specific on their USMCA requests and U.S. Trade Representative Robert Lighthizer needs to specify what the administration can deliver. Kind said he agreed with Neal on both accounts and that there’s a “dual responsibility."
“Everyone’s kind of looking at each other waiting for the other side to go first and that leads to a negotiation without end and I think patience is wearing thin,” Kind said.
Democrats “need to dwindle the issues down so that there’s focus on a relatively discrete set of issues and then find out what people are willing to accept and offer that as a possible solution or roadmap for Ambassador Lighthizer,” Kind said. On the other hand, “there’s nothing preventing Ambassador Lighthizer from coming up with some solutions based on all the concerns he’s heard now for months."
Kind said there’s an “early fall play” for getting USMCA on the House floor, but that “a lot will depend on the president’s desire to shut the government down in the end of September, early October, which will suck the life out of everything around here."
Under such circumstances USMCA would be “indefinitely postponed,” Kind said. -- Maria Curi (mcuri at iwpnews.com <mailto:mcuri at iwpnews.com>)
Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826




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