US seeks tougher rules in USMCA talks

Washington, July 1 (IANS) The Trump administration will press Mexico for stricter rules of origin, stronger labour and environmental standards, tighter intellectual property protections and greater American manufacturing content as it seeks to rewrite the United States-Mexico-Canada Agreement (USMCA), a senior administration official said on Wednesday.

The comments came soon after the United States declined to renew the USMCA in its current form during the agreement’s first mandatory six-year joint review, while keeping the trade pact in force as negotiations continue.

A third round of bilateral negotiations between the United States and Mexico is scheduled for the week of July 20.

According to a senior administration official, the upcoming talks will focus on strengthening the agreement’s rules of origin, enhancing North American economic security and addressing labour, environmental and intellectual property commitments.

“We’re gonna continue to talk to the Mexicans about rules of origin, about economic security,” the official said. “We’ve also had discussions with the Mexicans conceptually on labour, environment, and I think we’ll get into intellectual property.”

The administration believes tougher rules are needed to ensure more manufacturing takes place within North America and, in particular, inside the United States.

The senior administration official said existing automotive rules negotiated under the USMCA had helped increase regional production but argued they should now be expanded to other industries.

“When we redid NAFTA and did USMCA, we had a large focus on rules of origin for autos… but we think we need to tighten those rules, and we think we need to have similar robust rules for other industrial goods outside of the automotive space,” the official said.

The administration is also seeking stronger US content requirements to prevent manufacturers from relocating production to Mexico simply to gain duty-free access to the American market.

“What we don’t want is a situation where… everyone says, fine, I’m just gonna move everything to Mexico and import to the US duty-free,” the official said. “We have to have some kind of control and a rule of origin requiring US content level is one way to get at that.”

Beyond manufacturing, Washington wants Mexico to improve compliance with labour obligations and address environmental concerns along the shared border.

“We sense that Mexico has not really complied with a lot of the labour obligations,” the official said. “We sense that on the environmental side, we have issues on our very border with Mexico on water quality in a variety of things.”

The official acknowledged that Mexico had made progress on intellectual property enforcement over the past year but said: “there’s more to be done there.”

The administration also views economic security as an increasingly important element of North American trade policy. According to the senior administration official, Mexico has raised tariffs on countries outside the region to protect its own industries, a move Washington believes benefits the broader North American economy.

The USMCA replaced the North American Free Trade Agreement (NAFTA) in July 2020 and governs trade among the United States, Canada and Mexico. It includes detailed provisions covering automotive manufacturing, digital commerce, labour protections and intellectual property.

–IANS

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