In retaliation of the U.S. tariffs on Mexican steel and aluminum products, Mexico’s president, Enrique Peña Nieto, signed a decree imposing import duties on $3 billion worth of U.S. products. Mexico has also suspended the US’ preferential tariff treatment.
With its presidential election 26 days away, Mexico’s government imposed a 20 percent tariff on U.S. pork, apples and potatoes and 20 to 25 percent tariffs on cheese and bourbon.
The announcement comes as a senior Trump administration official said that President Trump wants to end the three-party talks to renegotiate the North American Free Trade Agreement (NAFTA). Instead, the president indicated he wants to deal separately with Canada and Mexico to restructure NAFTA.
However, it has been reported that the president does not intend to withdraw from NAFTA, National Economic Council Director Larry Kudlow indicated. “His preference now, and he asked me to convey this, is to actually negotiate with Mexico and Canada separately. He prefers bilateral negotiations.” Kudlow said.
It was not immediately clear how such an arrangement would work. All three countries have been working to renegotiate the deal since Trump became president. However, officials from the three countries have been unable to find consensus on several critical issues. Any changes in negotiations would have to be agreed by all sides.
The National Pork Producers Council (NPPC) issued a press release stating the punitive tariffs on unprocessed pork are 10 percent effective June 5 and will escalate to 20 percent on July 5. “The toll on rural America from escalating trade disputes with critically important trade partners is mounting,” said Jim Heimerl, NPPC president and a pork producer from Johnstown, Ohio. “Mexico is U.S. pork’s largest export market, representing nearly 25 percent of all US pork shipments last year. A 20 percent tariff eliminates our ability to compete effectively in Mexico. This is devastating to my family and pork producing families across the United States.”
Canada and the EU agree with Mexico, and all are pursuing tariffs and cases against the U.S. at the World Trade Organization (WTO) seeking a settlement disputing the U.S. tariffs on steel and aluminum.
