March 26, 2009: Transportation Secretary Ray LaHood wants to have a proposal developed to replace a now defunct Bush administration cross-border trucking program with Mexico by the time President Obama visits Mexico in mid-April, an administration official told BNA on background March 24.
LaHood has been meeting with members of Congress to design a program allowing Mexican trucks renewed U.S. access while addressing safety concerns, the official confirmed.
Currently, Mexican trucks must offload their exports onto U.S. vehicles in the border region.
A massive spending bill signed by President Obama late last month (46 DLR A-11, 3/12/09) included a provision that cancelled funds for and thus ended the Bush administration's cross-border trucking pilot program, put in place in September 2007 (174 DLR A-11, 9/10/07).
The program was aimed at complying with North American Free Trade Agreement cross-border trucking provisions. In response to the cancellation, Mexico on March 19 slapped higher tariffs on a wide range of U.S. exports worth $2.4 billion as permitted under NAFTA (50 DLR A-5, 3/18/09).
In Mexico City, Mexican Economy Secretary Gerardo Ruiz Mateos told reporters that Mexico would eliminate the tariffs if the United States renewed the trucking program. “In the moment the United States returns to the commitments it made last August, we will eliminate all the tariffs we imposed.” he said.
“For us, the solution is to go on with the program that we had, to go on with the pilot program that we had agreed two years ago to start to open up so that [the United States] realizes that free transit is best for both American and Mexican truck companies and for ‘competivity' in the region,” Ruiz Mateos said.
In response to the Mexican action earlier this month, White House Press Secretary Robert Gibbs said March 16 the Obama administration has asked for new legislation to create a new trucking project. “The president has tasked the Department of Transportation to work with the U.S. trade representative and the Department of State, along with leaders in Congress and Mexican officials, to propose legislation creating a new trucking project that will meet the legitimate concerns of Congress and our NAFTA commitments,” Gibbs said.
The United States has repeatedly put the brakes on NAFTA provisions that would have granted Mexican truckers nationwide access in 2000 and to U.S. border states in 1995. In 2001, a NAFTA panel said that the United States was violating the agreement by prohibiting Mexican trucks, ruling that American regulators could impose their own safety standards and restrict access for specific companies. The Bush administration started the demonstration program 18 months ago to allow some trucks to travel into parts of the United States.
Mexico Withholding Judgment
Separately, Arturo Sarukhan, Mexico's ambassador to the United States, March 24 said that Mexico “will wait to see what the proposal looks like.”
“But we are certainly willing to continue working cooperatively to find a solution that ensures the United States complies with its NAFTA obligations,” he added.
Sarukhan, who made his remarks at a Council of the Americas event, said that the end of the program was not about the safety of U.S. roads and drivers. “This is protectionism,” he added.
Sarukhan said that the Bush administration pilot program already addressed safety concerns. Lawmakers are “moving the goalposts” by demanding more measures, he said.
President Obama is scheduled to visit Mexico April 16-17 immediately prior to the Summit of the Americas meeting of Western Hemisphere leaders, which will take place in Trinidad & Tobago. A number of high-level administration officials will visit Mexico in advance of the president's visit, including Secretary of State Hillary Clinton and Department of Homeland Security Secretary Janet Napolitano. Clinton will travel to Mexico March 25.
Under questioning, Sarukhan characterized NAFTA as an “unmitigated success.” He said that the most pressing challenge the NAFTA partners now face is how to address the border challenges brought about by the Sept. 11, 2001, terrorist attacks on the United States.
Farm Bureau Seeks Resolution
Meanwhile, the American Farm Bureau Federation (AFBF) March 24 wrote to President Obama, urging quick resolution of the trucking dispute. AFBF President Bob Stallman said Mexico has already imposed $2.4 billion in trade retaliation because of the congressional action halting the program.
“We urge you to find a resolution that will honor our obligations under NAFTA, eliminating any cause for Mexico to halt U.S. trade,” Stallman said. Mexico's retaliation will affect hundreds of millions of dollars worth of fruit, vegetable, nut, juice, wine, processed foods, and oilcake exports to Mexico, Stallman said.
He urged the implementation of a trucking program compliant with U.S. obligations under NAFTA that assures safe vehicles on U.S. roads. “Delay in these actions will only prolong the negative impact on U.S. exports and our agricultural producers,” Stallman concluded.
International Brotherhood of Teamsters General President James P. Hoffa has criticized Mexico's response to the shutdown of the program. “The right response from Mexico would be to make sure its drivers and trucks are safe enough to use our highways without endangering our drivers,” Hoffa said in a March 17 press statement. “The border must stay closed until Mexico holds up its end of the bargain.”
By Rossella Brevetti