The Trump administration announced on Monday it has secured a preliminary U.S.-Mexico trade agreement. Under the pact, tariffs on agricultural products traded between the two countries would remain at zero. However, because the U.S. administration is still imposing tariffs on Mexican steel and aluminum imports, the retaliatory tariffs that Mexico imposed on certain U.S. cheeses also remain in place.
The Office of the U.S. Trade Representative also announced that for the first time in a U.S. trade agreement, the countries have agreed to not restrict market access in Mexico for U.S. cheeses labeled with certain names. A list of protected cheese names has not yet been released.
Specifically, USTR stated that the agreement will contain geographical indication (GI) standards that:
- Enhance transparency for opposition and cancellation proceedings for GIs;
- Establish a mechanism to consult on GIs pursuant to international agreements; and
- Allow for additional factors that may be considered in determining whether a term is a common name instead of a GI.
The preliminary agreement also reportedly contains provisions to enhance sanitary and phytosanitary measures; commitments to improve transparency and consultations on matters affecting trade between the two countries; and new protections for proprietary food formulas.
Details regarding these provisions have yet to be released.
Timeline
The administration is expected to formally notify Congress and publish the text of the agreement later this week. U.S. Trade Promotion Authority rules require the text of any trade agreement to be published 90 days before it is signed.
Both the United States and Mexico want to sign the agreement before December 1 so current Mexican President Enrique Pena Nieto can execute it on behalf of Mexico. This would forestall the possibility that Mexico’s incoming president, Andres Manuel Lopez Obrador, could demand changes to the agreement after he takes office.
Canada
Canada could be added to this agreement before it is formally announced. Canadian Trade Minister Chrystia Freeland arrived Tuesday in Washington, D.C., for talks on the remaining issues. The ongoing effort to eliminate Canada’s Class 7 pricing program, as well as increase market access for U.S. dairy products, is expected to be a dominant part of the next round of negotiations.
Members with questions may email Dave Carlin, IDFA senior vice president of legislative affairs and economic policy, at dcarlin@idfa.org.