The United States and Mexico have reached an agreement to end the trucking dispute between the two neighbors. President Barack Obama and Mexican President Felipe Calderon unveiled a deal resolving a longstanding dispute over cross-border trucking that has subjected the U.S. to billions of dollars in punitive tariffs. The plan will allow for half of those tariffs to be lifted immediately.
The agreement also establishes a reciprocal, phased-in pilot program that allows Mexican trucks to operate inside the U.S. provided they comply with a series of safety and driver-skills and language tests monitored by the U.S. Department of Transportation. The U.S. had effectively banned Mexican trucks from crossing the U.S. border, after the Teamsters union and others said the trucks weren't safe.
The ban was ruled a violation of the North American Free Trade Agreement, and subjected the U.S. to punitive tariffs by Mexico on a range of goods, from foods to Christmas trees. A senior U.S. administration official says, the deal is built on the highest safety standards that will authorize both Mexican and U.S. long-haul carriers to engage in cross-border operations under NAFTA.
The American Farm Bureau Federation is pleased that an agreement has been reached to resolve the dispute over cross-border trucking. AFBF President Bob Stallman, says this agreement has been a long time coming and this will have an immediate positive impact on U.S. agricultural exports.
"It is important for our trading partners to know that the United States lives up to its commitments under trade agreements," Stallman said. "Re-establishing a reciprocal cross-border trucking program will go a long way toward restoring our credibility and our relationship with a vital trade partner. The impact has touched a wide range of farm products from every state."
Another group that is supporting the deal is the U.S. pork industry. Pork exports to Mexico have been hit hard by Mexican retaliatory tariffs. In August, 2010, Mexico put a 5% tariff on U.S. bone-in hams, a big export item, and 20% on cooked pork skins in retaliation for the United States not complying with the trucking provision of the 1994 North American Free Trade Agreement.
National Pork Producers Council president, Sam Carney, a pork producer from Adair, Iowa, says this is great news for the U.S. pork industry, as well as for other sectors affected by Mexico's retaliatory tariffs. Still, NPPC cautions the issue won't be completely resolved until the United States is in full compliance with its NAFTA obligation on trucking.
Opponents of the NAFTA trucking provision claim there are safety issues with Mexican trucks, but available data, including data collected as part of the pilot program, demonstrate the safety of Mexican trucks, which must meet U.S. standards.