US plans ultimatum in Mexican energy dispute, raises tariff threat | – #plans #ultimatum #Mexican #energy #dispute #raises #tariff #threat
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March 27 (Reuters) – Biden administration USAIt plans to send a “move now or else” message to Mexico in the coming weeks to try to break the deadlock in the energy trade dispute, amid mounting bipartisan calls for the U.S. to get tougher with its southern neighbor. , according to people familiar with the discussions.
This step USA President Joe Biden and his Mexican counterpart Andrés Manuel López Obrador will mark a significant escalation of already tense tensions.
Obrador’s decision to roll back reforms aimed at opening Mexico’s power and oil markets to outside competitors has sparked a trade dispute.
Three people familiar with the talks told Reuters that the Office of the United States Trade Representative (USTR) has given Mexican negotiators “the last chance” to open their markets and agree to some increased controls. offer” is expected to make the offer described as. Otherwise, USA It will request an independent dispute settlement panel under the United States Mexico Canada Agreement, or USMCA, they said.
The United States and Canada called for talks to resolve the dispute with Mexico 250 days ago in July. Under USMCA rules, after 75 days of resolution, they were free to request a dispute resolution panel, a third party hearing the case.
At Monday’s event, Mexico’s Economy Minister Raquel Buenrostro said the US has the right to convene the panel as of October 3.
If the panel rules against Mexico and it fails to take corrective action, Washington and Ottawa could ultimately impose billions of dollars in retaliatory tariffs on Mexican goods.
The White House hopes to avoid escalating trade tensions with Mexico as it seeks help on immigration and drug smuggling. Months of talks have produced little progress and the administration has run out of less combative options, the sources told Reuters.
Raising the stakes in the controversy, he will launch a re-election bid in the coming weeks and face criticism from Republicans for his handling of immigration and drug trafficking. Biden carries a significant risk for Biden needs Mexico’s help to control the border after restrictions are lifted on May 11 amid the COVID-19 pandemic.
The US official admitted that he is growing frustrated with the lack of progress in the talks. “We want to see clear progress on this issue and address the concerns raised by our negotiating teams,” said the official, who spoke on condition of anonymity because the discussions are private.
A USTR spokeswoman declined to comment on energy talks with Mexico, but Trade Representative Katherine Tai hinted at a possible escalation during a Senate Finance Committee hearing Thursday when questioned about the talks.
“We are working with Mexico on concrete and specific steps that Mexico should take to address the concerns raised in our request for consultations. It is still a live issue,” Tai said.
He then added, “We know that all the instruments in the USMCA are there for a reason.”
U.S. oil companies such as Chevron ( CVX.N ) and Marathon Petroleum ( MPC.N ) have struggled to get permits to operate in Mexico in recent years, along with solar and wind energy companies.
Mexico’s Buenrostro said the transition to renewable energy and the challenges of connecting these projects to the grid were at the bottom of the issue.
“It is not that they are discriminated against, but we have technical difficulties,” said Buenrostro, adding that investments were made in energy distribution to solve the problems.
The potential move by the Biden administration comes weeks after the USTR ignited another trade dispute with Mexico over plans to ban genetically modified corn for human consumption. USMCA’s energy controversy execution is one step ahead within the framework of the mechanism.
The Biden administration claims that Obrador is the state oil company Petroleos Mexicanos (Pemex) and national the power utility commission is pro-Federal de Electricidad (CFE) and discriminates against US companies.
“I think you’re going to see more and more people … looking for the next step to create a panel relatively soon,” said a congressional aide, noting that patience on Capitol Hill for the negotiations is wearing thin.
Ron Wyden, a Democratic senator from Oregon and chairman of the Senate Finance Committee, told Tai on Thursday that Mexico is “exceeding” its USMCA obligations by shutting down US renewable energy firms.
“Eight months have passed. American clean energy producers are still waiting for a way out. “I think it’s long past time to say enough is enough and make it a matter of real dispute resolution,” Wyden said.
U.S. imports from Mexico to 324 in 2022, according to government data billion 455 against exports of more than USD billion dollars which is the US trade deficit of 130.5 billion dollars has been
By Jarrett Renshaw and David Lawder report; Added by Tim Gardner and Dave Graham report; Edited by Heather Timmons, Tomasz Janowski, and Chris Reese
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Source – reuters