Op-Ed | Getting North America Right

5/9/2016 Mexico Institute blog, Forbes.com

By Earl Anthony Wayne, Public Policy Fellow, Wilson Center

nafta (2)When the leaders of Canada, Mexico and the United States meet on June 29 for a North American Leaders Summit (NALS), they will have two big tasks: 1) to explain clearly why cooperation between the three countries is of great value; and 2) to give clear directions to their officials to do the hard technical work so that cooperation produces solid results for economic growth and competitiveness, for mutual security, for the shared continental environment, and for international cooperation where we can do more together than individually.

Since Mexico hosted the last so-called “Three Amigos” Summit in 2014, the tone in the U.S. domestic political debate has turned very critical of cooperation across the continent, whereas the actual collaboration and mutual understanding between the governments has improved.  The potential to help make all three countries more competitive in the world and to become a model for regional cooperation has increased, even as the electoral campaign attacks on the relationship with the United States’ two top export markets sharpened starkly.

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NAFTA May Have Saved Many Autoworkers’ Jobs

3/29/2016 The New York Times

When Donald Trump threatened to “break” the North American Free Trade Agreement, auto industry workers offered up some of the loudest cheers.

Mr. Trump easily won the Republican primary in Michigan this month. The state, home base for the American auto industry, also delivered an upset victory to Bernie Sanders, the Democratic anti-Nafta standard-bearer.

But the autoworkers’ animosity is aiming at the wrong target. There are still more than 800,000 jobs in the American auto sector. And there is a good case to be made that without Nafta, there might not be much left of Detroit at all.

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Canada, Mexico win $1-billion sanctions against U.S. at WTO

12/7/2015 The Globe and Mail 

NAFTACanada and Mexico may impose tariffs onto U.S.-traded products worth about $1-billion (U.S.), a World Trade Organization panel ruled on Monday, as the countries prepared to retaliate over the United States’ meat-labelling rules.

A WTO arbitration panel set the annual level of retaliation at $1.055-billion (Canadian) for Canada and $228-million (U.S.) for Mexico, considerably less than the $3.068-billion (Canadian) and $713-million (U.S.) the two countries had asked for.

The dispute stems from a 2009 U.S. requirement that retail outlets use labels in the United States to give consumers more information about the origin of their food.

Canada and Mexico have argued that U.S. rules, known as COOL (country of origin labelling), led to fewer of their cattle and pigs being slaughtered and processed in the United States, costing farmers’ income.

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As Ties With China Unravel, U.S. Companies Head to Mexico

New York Times, 06/02/14

mexico-chinaSALTILLO, Mexico — Jason Sauey calls them lemmings — all the American companies that rushed to China to make things like toys and toilet brushes, only to be searching now for alternatives in Mexico and the United States. His own family-owned plastics company, Flambeau, nearly made the same mistake around 2004, he said, when competitors contracting with China undercut prices and seized market share.

Flambeau resisted, turning instead to its factory here in central Mexico. And now the company — which makes Duncan yo-yos, hunting decoys, plastic cases and an array of industrial items — is reaping the rewards, Mr. Sauey (pronounced SOW-ee) said.

Revenues at its Mexican plant have grown by 80 percent since 2010, according to company records, prompting a search for a second location near Mexico City. And in the past year, a dozen corporations have come to Flambeau and requested bids on projects worth tens of millions of dollars for things like smartphone cases and car parts.

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NAFTA key to economic, social growth in Mexico

The Washington Times, 5/14/12

The North American Free Trade Agreement, which went into effect in 1994, has been the key driver of Mexico’s economic and social transformation of the past 20 years, analysts say. NAFTA at first brought an explosion of low-skill-labor factories to the Mexican side of the U.S. border. By the mid-2000s, the trade pact had triggered an increasingly sophisticated manufacturing base that now reaches across Mexico’s 31 states.

“What we’re seeing now is a growth of industry in Mexico that requires more engineers,” said Christopher Wilson, an associate with the Mexico Institute at the Washington-based Woodrow Wilson International Center for Scholars. “To put a name on it, specifically, we’re talking about automobiles and aerospace,” Mr. Wilson said. “Mexico is now graduating more engineers than Germany every year.”

A 40 percent jump in Mexico’s per capita gross domestic product since the inception of NAFTA has brought with it an increasingly robust middle class. “What that means is Mexicans are becoming more educated, and there is more investment in children, which is why you are able to see the development of an aerospace sector,” Mr. Wilson said.

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Chihuahua City is big dog in Mexico aerospace

The Washington Times, 5/14/12

When a jumbo jetliner touches down almost anywhere in the world, the last thing on the pilot’s mind is that the plane’s brakes likely were made in the capital of one of the most crime-riddled states in Mexico. Behind the headlines of warring drug gangs and a soaring murder rate in Mexico, a fast-growing high-tech economy centered on the aerospace industry has sprung up in recent years.

In Chihuahua City alone, 36 aerospace plants have opened since 2007 as a growing number of international parts makers use the city as a base for tapping a massive airplane-production market in the United States. “Our first objective was to get into the U.S. market and get a deal with U.S. customers,” said Nicolas Maillard, director of the French-owned Manoir Aerospace plant in Chihuahua City, 235 miles south of El Paso, Texas.

Shiny, precision-shaped steel discs produced by the plant are shipped to companies in Ohio and Kentucky, where they are added into the assembly line for brake systems on the Boeing Co.’s commercial airplanes. With the average cost of manufacturing labor running about $6 per hour in the city, a new era of high-tech growth is taking root. “The real advantage is the cost of labor,” Mr. Maillard said. “In France, labor would account for about 30 percent of the cost of production on an item like this. Here, it’s roughly 10 percent, and we’re closer to the market we’re trying to reach.”

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Mexico Says U.S. Stalling on Adding Nation to Pacific Trade Deal

Bloomberg-Businessweek, 4/23/12

Mexico’s Economy Minister expressed frustration over what he said was the Obama administration’s delay in adding the nation to Pacific trade talks.

Mexico’s entry to the Trans-Pacific Partnership, a sweeping deal that seeks to boost trade links between the Americas and Asia, is already supported by the private sector in all nine countries involved in the talks, Economy Minister Bruno Ferrari said in an interview. Mexico is closer to winning approval than Japan and Canada, who are also seeking to join negotiations, Ferrari said. U.S. Trade Representative Ron Kirk met with officials from Mexico and Canada this month in Washington during a visit by Mexican President Felipe Calderon and Canadian Prime Minister Stephen Harper.

The three nations are already bound together by the North American Free Trade Agreement that took effect in 1994. Standing beside his Nafta partners in the Rose Garden, President Barack Obama said the Pacific deal’s current partners are discussing how new members can meet the accord’s standards.

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