September 4, 2011
September 4, 2011
by Sean Hackbarth
“[T]wo Mexican trucking companies are on track to receive U.S. operating authority by the end of the month,” the Houston chronicle reports , in “a development that will help hundreds of U.S. companies regain their Mexican customers.” When these carriers receive preliminary operating authority, the last of $2.4 billion in retaliatory tariffs that have punished U.S. workers and farmers for more than two years will be suspended.
Under an agreement signed in June by the U.S. and Mexican departments of transportation, Mexican long-haul carriers will be allowed to deliver cargo from Mexico into the United States for the first time in more than two years. The move puts the United States on track to fulfill a 15-year old commitment to Mexico. This week, three U.S. carriers were also reauthorized to transport goods into Mexico under the same agreement.
This is a welcome end to a dispute that the U.S. Chamber of Commerce found could cost more than 25,000 U.S. jobs. In 2009, Congress ended a pilot project for Mexican trucks that itself was only a partial down payment on a 1994 U.S. agreement to authorize Mexican long-haul carriers. In retaliation, Mexico imposed high tariffs on a range of U.S. products, including paper, cosmetics, pork, dairy, potatoes, and apples, many of which saw their share in the large Mexican market drop precipitously. In many cases, direct competitors in Canada were quick to grab the U.S. share in Mexico.
Today, not just in Mexico, but in countries around the world, the United States, once the dominant player in international trade, is losing market share. For instance, in Colombia, as U.S. Chamber blogger John Murphy notes, U.S. producers of wheat, corn, and soybeans enjoyed a 78% market share in Colombia in 2008 that fell to only 28% by 2010 as other countries entered into preferential trade agreements with Colombia. Canadian producers are about to take the rest of the U.S. share with an agreement that was implemented last month. The United States has its own agreement with Colombia that would put U.S. growers back on an equal footing, but the White House and Congress have thus far failed to put it into effect.
Today’s news on Mexican trucks is a step back in the right direction, though. It’s not too late, with a renewed commitment to economic openness and trade leadership from Washington, for U.S. producers to regain the global competitiveness they once enjoyed. It’s not too late, but the clock is ticking. And U.S. jobs are at stake.
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