Mexico may accept US steel trade rule, rejects aluminum

Mexico may accept U.S. requests for greater regional content on steel, as long as there is a five-year phase-in period.

Foreign Relations Secretary Marcelo Ebrard said a U.S. request for 70% regional content on steel could be written into an addendum to the U.S.-Mexico Canada free trade agreement.

But Ebrard said Mexico won’t accept such regional content rules on aluminum, because Mexico lacks any aluminum production.

Ebrard repeated Mexico’s refusal to accept requests for U.S. inspectors at Mexican factories to ensure the country enforces its labour laws.

Pro-company unions have long been allowed to sign low-wage contracts behind workers’ backs. The low wages help Mexico lure tens of thousands of auto jobs away from the United States.

President Andrés Manuel López Obrador said Monday that U.S. officials had accepted Mexico’s offer to allow dispute resolution panels to review labour law compliance.

The trade agreement, known as the USMCA, was negotiated to replace the old North America Free Trade Agreement. However, Democrats in the U.S. Congress have held up ratification, in part because they want adequate assurances Mexico will enforce new laws requiring secret votes on union contracts.