>From kmander@igc.apc.org Thu Oct 7 15:17:46 1993 TRADE NEWS BULLETIN Volume 2 Number 178 Thursday, October 7, 1993 ________________________________________________________ HEADLINES: Mexico Rejects U.S. Proposal For New NAFTA Talks U.S., Mexican, Canadian Networks Propose Alternative to NAFTA Safety in the Workplace: Mexico's Achilles Heel Mexico Will Sign Measurement Agreement With U.S., Canada Activists Demand That Financial Secrets of NAFTA Be Revealed Korea Asks Mexico for Economic Opening Analyst Speculates Why Immigration Excluded From NAFTA _________________________________________________________ NAFTA/MEXICAN ECONOMIC News Summary _________________________________________________________ MEXICO REJECTS U.S. PROPOSAL FOR NEW NAFTA TALKS In an attempt to win more congressional votes for NAFTA, the Clinton administration requested further negotiations with the Mexican government over potential import surges under the free trade pact. Many believe NAFTA will not be passed unless Clinton has something else to show U.S. congressional members. U.S. Trade Representative Mickey Kantor confirmed that discussions with the Mexican government had re-opened in an attempt to establish better conditions for the U.S. sugar industry. A recent survey carried out by the industrial coalition USA-NAFTA revealed that up to 12 undecided congresspersons would vote in favor of NAFTA if there were better provisions in the agreement to protect against sudden increases in Mexican sugar imports. Kantor also said he met with fruit and vegetable producers in Florida and would try to negotiate an agreement with Mexico to provide certain safeguard mechanisms for these products. However, Herminio Blanco, Mexico's sub-secretary of International Trade Negotiations, rejected U.S. government efforts to renegotiate sections of NAFTA. He explained that neither the Mexican government nor the industrial sector would accept the proposal to re-open discussions on products such as sugar or fruits and vegetables, "even if the future of the NAFTA depends on it." Source: El Financiero, September 30, 1993; El Financiero, October 1, 1993. _____________________________________________________________ U.S., MEXICAN, AND CANADIAN GROUPS PROPOSE ALTERNATIVE U.S., Mexican, and Canadian coalitions called for an alternative trade agreement to NAFTA in a report entitled "A Just and Sustainable Development Initiative for North America." The report was produced through six months of intense negotiations between the Action Canada Network (ACN), the Mexican Action Network against Free Trade (RMALC), the Alliance for Responsible Trade (ART), and the Citizens' Trade Campaign (CTC). According to Jim Jontz, CTC director, U.S. congressional members need to understand that they do not have to limit their decision to the proposed NAFTA versus the current economic situation, but that they have a third option, a different proposal. The networks believe that the enormous disparities which exist between the United States, Canada and Mexico threaten salaries and living standards in all three countries. They suggest that economic integration should be accompanied by the establishment of new funding agencies for development, a reform of multilateral financing agencies' policies, and a reduction of payments on Mexico's foreign debts. The document states that the respect of human rights, the promotion of democracy and citizen participation in decision-making, and the reduction of economic inequalities between and within the countries should be the issues on which the integration and development of North America is built. Source: La Jornada, September 29, 1993. _____________________________________________________________ SAFETY IN THE WORKPLACE: MEXICO'S ACHILLES HEEL Of the 700,000 companies in Mexico, only 20% fulfill NAFTA safety and hygiene requirements, which means that Mexico can be sanctioned with fines under the accord. Jose Antonio Legaspi, director of medicine and safety at the Ministry of Work and Social Security (STPS) said that the disregard for safety and hygiene regulations, the practice of hiring minors, and the payment of sometimes below-minimum wage salaries could result in economic and trade sanctions against the Mexican government and Mexican factories once NAFTA takes effect. Contrary to widespread belief that the large companies have better safety conditions, medical services, and inspection practices, large Mexican companies have the highest number of accidents. The rating of accidents in companies with less than 5 employees, on the other hand, is much lower. Of the 700,000 companies registered with Social Security, 2% have more than 100 workers, 10% have between 16 and 100 hundred workers, and the rest are small companies. Source: El Financiero, September 29, 1993. _____________________________________________________________ MEXICO WILL SIGN MEASUREMENT AGREEMENT WITH U.S., CANADA Mexico, the U.S., and Canada will sign a regional cooperative agreement called Noramet to establish compatible measurement, dimension, and equivalency systems for products produced in the region. Fernando Sanchez Ugarte, sub-secretary at the Mexican Trade Ministry, made clear the need for mutual knowledge with regard to the equivalency and reliability of the laboratories in the three countries. The three countries are negotiating an agreement to develop laboratories throughout the region which will dedicate themselves to gauging whether products fit the required dimensions. Source: La Jornada, September 30, 1993; El Financiero, September 30, 1993. _____________________________________________________________ ACTIVISTS DEMAND NAFTA FINANCIAL SECRETS The Iberoamerican Solidarity Movement demanded that the Ministries of Trade and Finance reveal the contents of the secret financial negotiations which have been conducted under the North American Free Trade Agreement. The leaders of the movement, Carlos Cota Maza and Hugo Lopez, said that, in addition to secret negotiations on finance, the Mexican government is planning a "compulsory privatization" of the Mexican countryside so that banks can sell lands which are on the verge of being seized. According to the movement's leaders, the secret accords also include an agreement to channel millions of dollars from the Mexican Federal Reserves to new U.S. banks such as Manhattan Bank and Citibank so that they will buy Mexican debt bonds. The money which Mexico will receive for the sale of these bonds would be channeled into foreign markets instead of being invested in the country. Source: El Financiero, October 1, 1993. ________________________________________________________ KOREA ASKS MEXICO FOR ECONOMIC OPENING According to Jin-Keon Kim, head of the Mexican branch of the Korean Development Bank, if Mexico wants to acheive increased development and economic growth it needs to liberalize its financial sector and improve services to allow for effective competition. The Korean Development Bank (KDB) opened an office in Mexico last month(the first in Latin America). Its objective is to support Korean companies that are both investing in and trading with Mexico. The bank opening symbolizes potential opportunities for Korean companies which are expected to penetrate the U.S. market through NAFTA. Source: El Financiero, September 29, 1993. _________________________________________________________ ANALYST SPECULATES WHY IMMIGRATION EXCLUDED FROM NAFTA Juan Manuel Sandoval Palacios, coordinator of Chicano and Frontier Studies at INAH, argued during a recent press conference that the Mexican government is unwilling to discuss the problem of immigration with the U.S. because immigration reflects a domestic structural question which a trade agreement cannot resolve. He added that NAFTA negotiators believe the immigration problem would be reduced within twenty years. Former German Prime Minister Helmut Schmidt who was invited to Mexico to participate in a forum sponsored by Milenium, a center of strategic thought, said "the NAFTA will not solve the immigration problem, simply because the text of the agreement doesn't deal with the transfer of workers." Source: La Jornada, September 29, 1993; El Financiero, October 1, 1993. ________________________________________________________ The Thursday edition of trade.news is co-produced by: Equipo PUEBLO and RMALC. Equipo PUEBLO, Francisco Field Jurado 51, Col. Independencia 03630, Mexico DF, MEXICO Tel: 011-525-556-0642 Fax: 011-525-672-7453 E-mail: pueblo@laneta.igc.apc.org Red Mexicana de Accion Frente al Libre Comercio (RMALC) Address: RMALC, Godard 20, 07790 Mexico DF, MEXICO Tel: 011-525-556- 0642 Fax: 011-525-556-9316 E-mail: pueblo@laneta.igc.apc.org (temporary) Edited and distributed by the Institute for Agriculture and Trade Policy (IATP), 1313 5th Street, SE, #303, Minneapolis, MN, 55414- 1546. Tel: 612-379-5980 Fax: 612-379-5982 E-mail: iatp@igc.apc.org ________________________________________________________