Mexican government requested a dispute resolution panel under the
US-Mexico-Canada free trade agreement because it claims the United States is
improperly interpreting stricter regional content rules under the pact.
agreement, known as the USMCA, raised required regional content to 75% of a
vehicle’s value or components. Under the old NAFTA agreement, that threshold
Mexico’s Economy Department said Thursday that U.S. officials were taking an
unduly strict approach by not allowing "various methodologies” to
calculate content, something Mexico claims is contained in the USMCA annex.
number of Asian and European automakers have established plants in Mexico, and
sometimes import components from outside North America.
December, Mexico threatened legal action over proposed subsidies of up to
$12,500 for purchases of union-made, American-made electric vehicles.
says U.S. President Joe Biden’s Build Back Better Act, currently before the
Senate, would discriminate against potential exports of Mexican-built
electrical vehicles and favour domestic producers, something it claims is
forbidden under the USMCA. The United States, meanwhile, is
concerned Mexico is trying to favour its own state-owned electrical power
November, U.S. ambassador to Mexico, Ken Salazar said the United States has
“serious concerns” about the Mexican government’s attempts to limit competition
in the electrical power sector. Mexican President Andrés Manuel López Obrador
proposed constitutional changes earlier this year to restrict the market share
of private power generators and favour Mexico’s state-owned utility company.
Source: Google Images
Source: Manufacturing Business