In July, both governments signed an agreement resolving the trucking issue, with the US Department of Transportation crafting a cross-border trucking program and the Mexican government cutting the retaliatory tariffs by 50 percent. The remaining tariffs were suspended on Oct. 21 after DOT issued the trucking permit.
“America’s pork producers are very pleased that the US issued the first Mexican trucking permit, which has led today to the Mexican government removing the remaining retaliatory tariffs on our products,” said Doug Wolf, NPPC president. “Mexico is a very important market for the US pork industry and for many other sectors. More than 6 million US jobs depend on trade with Mexico.”
The long-standing dispute between the nations was over a provision of the 1994 North American Free-Trade Agreement (NAFTA), according to NPPC. The trucking provision was set to become effective in December 1995, but the US failed to abide by it. Mexico imposed tariffs on 89 US products in March 2009, after Congress failed to renew a two-year-old pilot program that allowed a limited number of Mexican trucks into the US. Mexico added products to the tariff list, including pork, in August 2010 after the Obama administration failed to present a proposal for resolving the trucking dispute.
“It is important that the US abides by its NAFTA obligations and does not yield to protectionist forces,” Wolf said. “US exports and American jobs are at stake.”
Mexico is the second-largest market for the US pork industry, which shipped $986 million of pork south of the border in 2010. Since 1993 – the year before NAFTA was implemented – US pork exports to Mexico have increased by 780 percent.
“This is a great victory for the US meat and poultry industry,” added J. Patrick Boyle, president and CEO of the American Meat Institute. “Mexico is a vital trading partner and this pilot program will allow US pork producers and producers of other products affected by the retaliatory tariffs to regain their competitive positions and market shares in Mexico and recover jobs lost because of the decline in exports.”