70217
Stakes High for Mexico in US Trade Talks
Stakes High for Mexico in US Trade Talks

Stakes High for Mexico in US Trade Talks

Stakes High for Mexico in US Trade Talks

President Donald Trump’s push to renegotiate the North American Free Trade Agreement is putting Mexico in a tough spot, threatening the system that has helped turn the country into a top exporter through low wages, lax regulations and proximity to the United States.
With talks set to start Wednesday, the Trump administration is targeting the US trade deficit with its southern neighbor and the weakly enforced labor, environmental and manufacturing rules that for 23 years have drawn American assembly plants to Mexico, leading to a northbound flood of televisions, cars and appliances, nwaonline reported.
“Mexico was resting on its merits and has been in a comfort zone, and now we have to leave it,” Economy Minister Ildefonso Guajardo told a business group recently. “The alarm clock has rung for us to wake up.”
A key draw for foreign assembly plants and investment has been Mexico’s low wages. While average manufacturing wages in China had risen to $3.60 per hour by 2016, Mexico’s had shrunk to $2.10—a level some economists say is artificially low. With many workers unable to afford the vehicles Mexico produces, the country exports about three times as many cars as are purchased domestically, most to the United States.
“It is a very serious problem,” Alex Covarrubias, a labor professor at Mexico’s Sonora College, said of the country’s wage policy. “Almost all the (labor) contracts that are signed in Mexico are unlawful, which means that they are company contracts, which the workers aren’t aware of.”
The Trump administration is pressing to bring labor and environmental regulations—originally contained in weakly enforced “sidebar” agreements—into the main body of NAFTA’s text, and to require that Mexico’s government ensures the “effective recognition of the right to collective bargaining.”
Tightening Mexico’s labor laws and strengthening unionization could push wages up, or at least stem the flight of jobs to Mexico, experts say.

Short URL : https://goo.gl/YaDb4h
  1. https://goo.gl/khKNTL
  • https://goo.gl/HBhgRs
  • https://goo.gl/Zq9vQp
  • https://goo.gl/XK782X
  • https://goo.gl/J4CQzS

You can also read ...

China and India continue to remain the most promising investment destinations in 2017.
Developing Asia is expected to witness a 15% increase in...
Thai CB Retains Key Rate
Thailand’s central bank on Wednesday left its key interest...
Elon Musk, Kevin Plank, Bob Iger, Richard Trumka, Kenneth Carleton Frazier
The honeymoon is definitely over. When US President Donald...
Brazil Raises Deficit Ceiling
Brazil is raising its deficit ceiling for this year and 2018...
Riksbank is under pressure to tighten its ultra-loose monetary policy.
Underlying inflation topped the Swedish central bank’s target...
US Household Debt at $12.8 Trillion
US household debt reached a new record in the second quarter,...
At 310% GDP, China’s banking sector is above the advanced economy average and nearly three times  the emerging market average.
China's economy is looking good enough that the International...
Crude oil accounts for 96% of exports and around half of state revenue.
Venezuela might look bad right now amid protests, scarce food...

Add new comment

Read our comment policy before posting your viewpoints

Image CAPTCHA
Enter the characters shown in the image.

Trending

Googleplus