Tag Archives: Mexico

The Mexican Olympic Committee said Wednesday it will no longer be able to offer food, lodging and medical services at its main sports training complex, the latest casualty in a round of deep budget cuts by President Andres Manuel Lopez Obrador.

Seldom has a leftist been so obsessively austerity-minded as Lopez Obrador. In his first seven months in office, he has cut government posts and salaries, and drastically reduced spending on perks and benefits.

He also has cut his own salary and plans to sell off the presidential jet, saying: “We cannot have a rich government with the people poor.”

Lopez Obrador describes his financial plan as “republican austerity.”

But his cuts have begun to seriously hit everyone from athletes to archaeologists, who worry they won’t have enough money to carry out essential tasks. Critics say his government is spending the same amount of money, just reallocating it to different things.

The Mexican Olympic Committee said it lacks the $4.7 million needed to run the Olympic sports center in Mexico City with full services. The complex has track and pool facilities, as well as a gymnasium and velodrome. This year, government funding for sports is about 25% below 2018 levels.

Also this week, researchers and archaeologists at the National Institute of Anthropology and History said about 200 employees have been laid off since the start of the year, and more layoffs are feared.

“We have gone from republican austerity to Franciscan poverty,” said Joel Santos, head of the researchers’ union at the institute. Never well-paid, many experts are employed on temporary contracts.

Across the government, Lopez Obrador’s administration has eliminated consultancy and management positions, and thousands more public servants have resigned.

Economist Valeria Moy says the government has plenty of fat to trim, but notes that this year’s federal budget of $5.8 trillion pesos ($304 billion) is about the same size as the 2018 budget. Lopez Obrador took office in December, allowing him to craft the 2019 budget.

“There is money,” said Moy, “it’s just being redirected” to the president’s social and infrastructure projects, some of which appear to be “almost whims” that lack sound research to determine their viability or potential negative impacts.

Environmentalists and investors are concerned about several of the president’s top infrastructure projects, such as a train through the Yucatan Peninsula that has commenced construction without studies to show its impact on local wildlife such as jaguars. Another pet project, the multibillion-dollar Dos Bocas oil refinery in Lopez Obrador’s home state of Tabasco, is being undertaken by the heavily indebted state oil company Petroleos Mexicanos.

“It’s what the president decides, what the president wants — and that’s what’s done,” said Moy.

Finance Minister Carlos Urzua resigned last week citing similar concerns, saying the administration has taken public policy decisions “without sufficient sustenance.”

Everyone from scientists to doctors and police warn that the president is cutting to the bone.

Many blame the May air pollution emergency in the capital on over-ambitious budget cuts, because the Environmental Ministry lacked the tools and manpower to detect and combat brush fires that carpeted much of the country in heavy smog.

The country’s Science and Technology Consultative Forum, a sort of umbrella group of science academies and businesses groups, has warned that the cuts threaten research into everything from chronic diseases to climate change to agriculture.

“All of these activities could be seriously compromised if the austerity measures are applied indiscriminately,” the forum said in a statement earlier this year. “If that happens, it would be an irredeemable setback in Mexico’s effort to achieve robust national development, and would make us even more dependent on what occurs beyond our borders.”

Sioux Falls, SD – The American Coalition for Ethanol (ACE) and Iowa Renewable Fuels Association (IRFA) hosted a tour in conjunction with the U.S. Grains Council (USGC) in Iowa last week to show nine decision-makers from key Mexican retail and supplier groups how ethanol blends have been successfully and profitably incorporated across Iowa.

 

Tour leaders Ron Lamberty, ACE Senior Vice President, and Lucy Norton, IRFA Managing Director, said tour participants were engaged and clearly enthusiastic about the prospect of adding ethanol blends to their businesses.

 

“The week’s events exceeded our expectations,” Lamberty said. “We wanted this tour to end any lingering doubt these marketers might have about implementing ethanol blends in Mexico. After seeing stations and equipment just like theirs being used to sell E10, and hearing station operators say they’ve sold ethanol profitably for decades without any issues, some who attended plan to do tests in the next several months, and when those tests go well, we’ll encourage those marketers to share their success stories with peers in Mexico, as ACE has done to develop markets in the U.S.” 

 

“We see this trip as just the beginning of a long relationship that leads to a new ethanol market in Mexico,” Norton said. “We were fortunate to have such an influential group participate that represented about 500 million gallons of fuel sales and distribution. IRFA was proud to showcase Iowa’s 40 years of success in marketing ethanol-blended fuels.”

 

Several tour attendees said they are ready for the many benefits ethanol can bring to Mexico, including lower-fuel costs, improved air quality, and quality fuel. Read testimonies from participants below.

 

“The entire tour has been a fabulous learning experience, even better than I expected,” said Agustín Tristán Aldave with Lexington Midstream, a midstream investor and provider. “What I was looking forward to the most was learning about the entire process from front to back, and it was incredible to see the innovation here in the U.S. I don’t see any reason why not to do [ethanol] it. Ethanol is cheaper and better for the environment, and these are important points to help differentiate yourself if you’re a retailer.”

 

“We need all the information we can to make a change in Mexico,” said Gerardo Cantú, Director of Petrorack, a fuel provider to the industrial market. “From the beginning of the first visit, the tour impressed me. I believe this is a good product for the customer and our country. We are short on gasoline and ethanol, so we need the supply from the U.S.”

 

“We understand the nature of the product and we see the benefits that it brings to the environment and to the consumer because of the lower price of the fuel,” said Fernando José Pereira Flick with Lodemo, one of the main retail service groups in Mexico, which operates the first private (non-PEMEX) marine terminal for fuels in Mexico on the Yucatan Peninsula. Lodemo is evaluating adding infrastructure to import ethanol.  “It’s something that we don’t need to test because it’s been proven by the U.S. fuel industry to be a quality product as we’ve seen on this tour. With the changes to the Mexican energy legislation, it has created an opportunity for the private sector.” 

 

“We’ve seen the successful case for ethanol in Iowa and I’d like to see that in my country, helping the people in the field and having a very good gasoline like the one you have here that’s helpful to the environment,” said Blanca Estela Coeto Mateo with SIMSA, the largest supplier of fuel to PEMEX. “I’d like to see the Mexican government working together with all the people with one goal, and I will express that with the people in Mexico about the successful case you have in this country.”

 

Daniel Beltrán García, who works with Comborsa, an importer and distributor of fuels near the U.S./Mexico border said, “As a private company, we recognize the Mexican consumer needs a better, cleaner product, and why not at a more competitive price? So, that is what we have learned in Iowa in the sense that ethanol provides exactly that.” Another fuel marketer, Roberto Spinola De Leo with Hidrosina, which operates 30 service stations in Mexico City, where E10 is currently banned said, “We’re ready for ethanol depending on the regulation being authorized for that to happen. Our companies need to do our part in supporting [changes to] ethanol regulations because it’s good for us, the consumers, and the country.”

Supporters of the U.S.-Mexico-Canada Trade Agreement have been pushing for some time to see a summer vote on the deal. They’d like Congress to ratify the deal before they head off on their August recess. However, House Democrats say they’re not in a hurry to hold a vote.

That pre-recess legislative window is getting closer to slamming shut. Politico says Democratic lawmakers have said for some time that a summer deadline to pass the agreement wasn’t realistic. House Speaker Nancy Pelosi’s nine-member working group is holding meetings with U.S. Trade Representative Robert Lighthizer to address potential changes to the agreement.

As a result, some aides think that there may still be a chance to get the deal ratified in 2019. One aide tells Politico that a September vote is possible, depending on how far Lighthizer can or is willing to go to address Democrat concerns on enforcement, labor, environment, and drug pricing provisions in the deal. Many legislators, officials, and industry observers in Washington agree that once the presidential election year begins, the chances of ratifying USMCA will plummet.

The National Cattlemen’s Beef Association (NCBA)  recently launched a media campaign urging Congress to pass the U.S.-Mexico-Canada Agreement (USMCA). The campaign features personal stories from cattle and beef producers across the country who want Congress to ratify the USMCA as quickly as possible.

“The USMCA keeps the highly successful framework for U.S. beef trade in place and preserves access to two of our largest export markets,” said NCBA President Jennifer Houston. “Cattle producers need certainty with Canada and Mexico so that we can continue to build on 25 years of duty-free, unrestricted trade in North America.”

Unrestricted, duty-free trade under USMCA will continue to allow U.S. cattle and beef producers to capitalize on growing demand in lucrative markets in Canada, Mexico, and around the world. USMCA maintains science-based trade standards while rejecting failed policies of the past, like mandatory country-of-origin labeling.

The NCBA campaign will center around a new USMCA website, policy.nbca.org/usmca. Visitors to the site can click on a dynamic map to pull up state data, producer profiles, and news articles related to USMCA. The map will be updated weekly with new content and profiles.

MEXICO CITY (AP) — Mexico’s Senate voted overwhelmingly Wednesday to ratify a new free trade agreement with the United States and Canada, making it the first of the three countries to gain legislative approval.

Mexico’s upper chamber voted 114 to four with three abstentions in favor of the U.S.-Mexico-Canada Agreement, or USMCA. It will replace the North American Free Trade Agreement, or NAFTA, which U.S. President Donald Trump had threatened to withdraw the United States from if Washington did not get a better deal.

Mexican President Andrés Manuel López Obrador said in a recorded message that the vote was “very good news.”

“It means foreign investment in Mexico, it means jobs in Mexico, it means guaranteeing trade of the merchandise that we produce in the United States,” he said.

The treaty does not need to be approved by Mexico’s lower house. It is still awaiting consideration by lawmakers in the United States and Canada, however.

“Congratulations to President Lopez Obrador — Mexico voted to ratify the USMCA today by a huge margin. Time for Congress to do the same here!” Trump tweeted.

U.S. Trade Representative Robert Lighthizer in a statement applauded Mexico’s ratification as “a crucial step forward.”

Ratification of the deal still faces some opposition in the Democrat-controlled U.S. House of Representatives.

The United States is by far Mexico’s biggest export market and its easy passage through the legislature had been expected. The approval came after Trump threatened to impose tariffs on all Mexican goods if López Obrador didn’t reduce the flow of U.S.-bound illegal immigration from Central America, a threat that was later suspended.

The USMCA was hammered out last year by delegations representing then-President Enrique Peña Nieto, of the Institutional Revolutionary Party, and then-President-elect López Obrador, of the left-leaning Morena, ensuring that both the outgoing and the incoming administrations were on board. López Obrador took office Dec. 1, a day after the agreement was signed.

Mexican lawmakers had already executed a series of labor reforms that the U.S. had demanded.

Mexico’s economy ministry said that with Senate approval “Mexico sends a clear message in favor of an open economy and of deepening its economic integration in the region.”

Mexico’s peso strengthened moderately against the dollar to 19.03 Wednesday, though the main factor was the U.S. Federal Reserve signaling that it was prepared to cut interest rates if needed to protect the U.S. economy, according to Gabriela Siller, economic analysis director at Banco BASE.

The United States buys about 80% of Mexican exports, some $358 billion worth last year. In the first quarter of 2019 the two countries did $203 billion in two-way trade, making Mexico the United States’ No. 1 commercial partner for the first time, ahead of Canada and China, according to the Mexican Economy Department.

Sen. Ricardo Monreal, leader of the governing party in the Senate, said the vote was “an important step to diminish the existing uncertainty for North American trade.”

Canadian Prime Minister Justin Trudeau heads to Washington, D.C. this week, as part of an effort to ratify the U.S.-Mexico-Canada Agreement. The trade deal has the least path of resistance in Mexico, where lawmakers are expected to ratify the agreement this month.

The trade deal also faces a quick route to passage in Canada, leaving passage in the U.S. the toughest battle to fully ratify the agreement. Canada expects final consideration of the agreement before September. Trudeau is scheduled to meet with House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell, along with a planned meeting Thursday with President Donald Trump, according to Reuters.

Trump, along with agriculture groups, have pushed for quick passage of the agreement. However, House Democrats want more time to review the agreement, pressing for potential changes. The agreement must first pass the U.S. House before the Senate can consider the agreement. Nearly 1,000 agriculture groups together last week urged Congress and the Trump administration to finish the agreement.

Expanding U.S. export markets is vital to the success of American pork producers, but trade disputes with some of our top markets, most notably China, are hampering growth and have caused severe financial harm to U.S. hog farmers, National Pork Producers Council Vice President and Counsel of Global Government Affairs Nick Giordano said today at a Global Business Dialogue event in Washington, D.C.

“Mostly because of free trade agreements, the United States is the leading global exporter of pork. As a result, U.S. pork is an attractive candidate for trade retaliation. America’s hog farmers – and many other sectors of U.S. agriculture – have been at the tip of the trade retaliation spear for more than a year,” Giordano explained to the briefing at the National Press Club.

 

While Mexico’s 20 percent retaliatory tariff on U.S. pork was recently lifted, America’s producers still face a stifling 62 percent tariff into China. There are enormous trade opportunities with China, especially to help offset reduced domestic production due to African swine fever (ASF), a pig-only disease with no vaccine treatment that poses no human health or food safety risks, but that is almost always fatal for hogs, Giordano noted.  ASF has spread to every province in China, other parts of Asia and in Europe.

Giordano said NPPC is working with the U.S. Department of Agriculture and Customs and Border Protection to strengthen biosecurity at our borders and on our farms to prevent its spread to the United States.

“We have always known that China holds more potential than any market in the world for increased U.S. pork sales. But, today, because of African swine fever, that potential is off the charts, offering the single greatest sales opportunity in our industry’s history,” said Giordano. “China needs reliable suppliers of pork now, and likely, well into the future. The question U.S. hog farmers are asking: ‘Will we get the main course, or will we get the crumbs off the table?'”

“For most of the last year, the U.S. pork industry has the dubious distinction of being on three retaliation lists: China and Mexico related to U.S. actions under Section 232 of the Trade Expansion Act of 1962 and China in response to U.S. tariffs imposed under Section 301 of the Trade Act of 1974,” Giordano said. Last year, Mexico was the industry’s largest volume market and China was the third top market by volume, although punitive tariffs imposed by those two countries have cost U.S. pork producers $2.5 billion over the last year.

“U.S. pork production costs are among the lowest in the world with safety and quality that are second to none. But for the retaliatory duties, the United States would be in a perfect position to take advantage of this massive import surge in the world’s largest pork-consuming nation and single handedly put a huge dent in the U.S. trade imbalance with China,” Giordano said. Instead, Chinese pork buyers are reaching out to those in Europe, Canada and Brazil for supplies. “What should have been a time of enormous prosperity and growth for U.S. pork producers and their suppliers will instead fuel jobs, profits and rural development for our competitors,” he noted.

“U.S. hog farmers understand the challenges faced by this administration in recalibrating U.S. trade policy toward China. The issues are myriad and complex. Moreover, hog farmers appreciate the farmer aid packages that the administration has put forward,” Giordano continued. “However, the China pork tariff needs to be lifted.”

Giordano’s full remarks can be read here.

President Trump tweeted late Friday that he’d suspended plans to impose tariffs on Mexican goods, saying the U.S. and Mexico had reached an agreement on stemming illegal immigration.

The president says Mexican officials “agreed to take strong measures” to cut down on the flow of illegal immigrants traveling through Mexico and entering the U.S. An Associated Press report says the move puts to an end a threat that had sparked warnings from members of Trumps party, as well as administration officials, about long-term damage to the economy.

The damage would include driving up prices for consumers, as well as put the recently-updated U.S.-Mexico-Canada Trade Agreement in jeopardy. U.S. and Mexican officials met for more than 10 hours on Friday and ended a third day of talks with an agreement that would satisfy Trump’s demand that Mexico crack down on illegal immigration into the U.S.

Republicans in Congress had recently warned the president that they were ready to try and stop imposing tariffs on Mexico that were scheduled to begin on Monday. They were worried about driving up costs to consumers and the damage to the economy.