NAFTA Monitor Tuesday, February 15, 1994 Volume 1, Number 8 ____________________________________________________ Headlines: DALLAS MAY HOST NAFTA LABOR COMMISSION CONGRESS REPS WHO VOTED 'NO' ON NAFTA FACE TOUGH CAMPAIGN NAFTA PARITY WILL REQUIRE ECONOMIC CHANGES IN HEMISPHERE MARKET SECTOR DEVELOPS AROUND NAFTA BUSINESS EXPANSION UNINSURED MEXICAN TRUCKERS PROHIBITED FROM ENTERING U.S. RESOURCES ____________________________________________________ DALLAS MAY HOST NAFTA LABOR COMMISSION The Clinton administration is expected to announce that Dallas will house NAFTA's "labor secretariat," an agency established under the free trade accord to monitor labor market conditions in the United States, Canada and Mexico. "We haven't been notified officially that the NAFTA secretariat is going to be in Dallas, although it is looking quite good," said Mayor Steve Bartlett. "I'm very optimistic," said Representative John Bryant (D-Texas) who has lobbied trade officials to place the office in Dallas. The DALLAS MORNING NEWS quoted sources in Washington and Texas as saying the Clinton administration would make the announcement soon. Source: "Dallas Likely to be Site of Major NAFTA Office," UPI, February 12, 1994. ____________________________________________________ CONGRESS REPS WHO VOTED 'NO' ON NAFTA FACE TOUGH CAMPAIGN The TEXAS OBSERVER noted recently that Representatives Gene Green (D-Texas) and Craig Washington (D-Texas) are being targeted by the HOUSTON CHRONICLE for failing the "NAFTA test." The CHRONICLE reportedly endorsed Green's primary opponent, Ben Reyes, because Green followed the demands of labor unions and voted against NAFTA. However, Green's vote won him strong support from the AFL-CIO. In a recent report, the AFL-CIO cited Green as one of five Congressional representatives who voted 100 percent in agreement with labor on 12 issues, including NAFTA. Sources: "NAFTA Retribution," TEXAS OBSERVER, February 11, 1994; "Labor Scorecard," TEXAS OBSERVER, February 11, 1994. ____________________________________________________ NAFTA PARITY WILL REQUIRE ECONOMIC CHANGES IN HEMISPHERE The direction of Latin American and Caribbean economies will be guided largely by whether they receive parity with NAFTA, according to an article in GLOBAL PRODUCTION & TRANSPORTATION. Accession to the North American market is "foremost on the minds of private and public sector players in the region," writes Kathleen Dunnewald. The U.S. Congress is expected to consider a bill, sponsored by Representative Sam Gibbons ( D- Florida), giving members of the Caribbean Basin Initiative (CBI) parity with NAFTA for three years. CBI members, who have received preferential access to some U.S. markets over the past nine years, would be required to negotiate their own free trade agreements with the U.S. or accede to NAFTA during the three-year period. "Parity is going to be a two-way street," said Andrew Postal, president of a New York City-based apparel company that is active in the Caribbean Basin "Because of the politics in this, you can expect demands coming from Washington that are going to establish a great many pre-conditions before the benefits of NAFTA are conferred on the region." Cameron Clark, president of a Connecticut-based consulting firm, said he expects qualitative factors, such as workers' rights, health, safety, welfare, the environment and intellectual property rights to be the keys to expanding NAFTA to CBI nations. Clark also noted that the biggest factor currently facing Latin American economic growth is private sector management and production. "The private sector must become more competitive," Clark said. "The ability of the Caribbean Basin to benefit from NAFTA will depend upon improving our production and improving our efficiency." The Clinton administration is considering extending parity to CBI members, but has also been pushing for the creation of a Western Hemisphere free trade zone in 10 to 15 years. Under the plan, Latin American countries, beginning with Chile, would be required to join NAFTA. Clinton is expected to unveil the plan during a meeting of 34 of the hemisphere's leaders scheduled for this spring. Sources: Kathleen Dunnewald, "Plotting NAFTA Parity," GLOBAL PRODUCTION & TRANSPORTATION, January/February, 1994; Canute James, "U.S. Seeks to Ease Impact of NAFTA on the Caribbean," JOURNAL OF COMMERCE, January 26, 1994; Steven Greenhouse, "U.S. Plans Expanded Trade Zone," NEW YORK TIMES, February 4, 1994. ____________________________________________________ MARKET SECTOR DEVELOPS AROUND NAFTA BUSINESS EXPANSION A number of marketing companies located along the U.S.-Mexico border have begun selling services to U.S. and Canadian firms looking to relocate to Mexico. The North American Plant Relocation (NAPR), for example, offers a "1-800-5-RELOCATE" number companies can call for information on joint ventures, subcontracting, shelters, franchising, consulting and distribution. NAPR states in its ad, "Relocation to Mexico Made Easier," that it will "acquire permits, documentation and set up the corporation necessary for your operation in as little as 45 days." Another company called TraTec offers a complete "factory Start-Up" package for large and small manufacturers looking to open facilities in Mexico. "We lease the Mexican employees to you, train and educate your transferred key production management staff in local Mexican traditions, decorum, and requirements to succeed in the Mexican environment," states the TraTec ad. Washington Pharmaceuticals, Safety Storage, Schlage Lock, I.T.T., Mennen and Davis & Geck are listed as clients. Sources: "Important NAFTA Update," TRATEC AD, GLOBAL PRODUCTION & TRANSPORTATION, January/ February, 1994; "Relocation to Mexico Made Easier," NAPR AD, GLOBAL PRODUCTION & TRANSPORTATION, January/ February, 1994. ____________________________________________________ UNINSURED MEXICAN TRUCKERS PROHIBITED FROM ENTERING U.S. Texas state police have recently stepped up efforts to stop Mexican truckers with unauthorized insurance from driving in the United States. Texas authorities estimate that random spot-checks on Mexican truck drivers have cut in half the number of inadequately insured trucks. Before the checks began, authorities reported that an estimated 15 percent, or 3,600 of the 24,000 trucks that crossed in to Texas each day carried coverage from unauthorized, offshore insurers. The percentage of uninsured trucks now entering Texas has dropped to 7.5 percent or 1,800 per day, said Mary Sherman, an investigator for the Texas Insurance Department. Mexican truckers are currently only able to travel 30 miles past border crossings into the U.S. But in 1995, as negotiated under NAFTA, Mexican motor carriers will have full access to all border states and in 2000 will be able to trade all across the United States. The American Automobile Association (AAA) is concerned that U.S. truck size and weight, licensing and safety standards will be lowered to meet those requirements in Mexico and Canada. AAA sent a letter to U.S. Trade Representative Mickey Kantor shortly after the NAFTA vote, urging him to establish safeguards that will prevent the weakening of U.S. truck standards. Sources: Brigitte Maxey, "Texas Gets Tough on Mexican Truckers," JOURNAL OF COMMERCE, January 25, 1994; Brian Nicol, "Trucks, Trade and AAA," HOME & AWAY. ____________________________________________________ RESOURCES ____________________________________________________ 1. "51 Alternatives to NAFTA," ECONOMIC JUSTICE REPORT, 1V/1, April, 1993. 12 pages. $2.00. 11 Madison Ave., Toronto, Ontario, Canada M5R 2S2. This report presents a wide range of policy alternatives to promote sustainable development should the Canadian and Mexican governments withdraw from NAFTA. 2. "Intellectual Property Rights in NAFTA," ECONOMIC JUSTICE REPORT, 1V/1, April, 1993. 12 pages. $2.00. 11 Madison Ave., Toronto, Ontario, Canada M5R 2S2. This study explores the implications of NAFTA's intellectual property provisions for health care and industrial policy. 3. NAFTA Origin Expert-System Software, LIVINGSTON GROUP, February 1993. $4,995.00. Origin Department, 405 405 The West Mall, Toronto, Ontario, Canada M9C 5K7. Tel: (800) 387-7582. Fax: (416) 622-3890. This software program, designed by a former member of Mexico's negotiating team, guides the user through NAFTA's 1,200-page text to investigate new manufacturing and export regulations and required documentation. ____________________________________________________ The following email services are offered by the Institute for Agriculture and Trade Policy: "trade.library" - a storehouse of trade related documents, including analyses, reports, fact sheets, White House transcripts ... etc. "trade.strategy" - an open discussion of trade issues and events "eai.news" - a regular bulletin summarizing the latest news in Latin American integration and development "susag.news" - a regular news bulletin pertaining to sustainable agriculture "susag.library" - longer documents, studies and analyses on sustainable agriculture "susag.calendar" - a calendar of events "env.biotech" - a news bulletin about biotechnology If you are on EcoNet/PeaceNet, you may access these services by going to the "conferences" section.. If you are on another system and would like to be added to the e-mailing list for these services, send email to "kmander@igc.apc.org" with a note requesting to which lists you'd like to be added. NAFTA Monitor is produced by: Gigi DiGiacomo and Kai Mander Institute for Agriculture and Trade Policy (IATP) 1313 5th Street, SE, Suite 303 Minneapolis, MN 55414-1546 USA tel: (612) 379-5980 fax: (612) 379-5982 email: kmander@igc.apc.org ____________________________________________________