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Mexico and the European Union plan to pick up the pace in trade talks to strike a deal to revise an existing pact before the end of 2017, the country’s top trade representatives confirmed May 8.
Mexico’s Economy Minister Ildefonso Guajardo and European Trade Commissioner Cecilia Malmstroem met in Mexico City to give a political push to the talks.
The ambitious deadline for updating the Mexico-EU Free Trade Agreement is being driven by an upcoming presidential election in Mexico in 2018 and the looming negotiations over the North American Free Trade Agreement (NAFTA), according to Guajardo.
“Mexico has clearly said since day one of Pena Nieto’s administration that one of its basic strategies is trade,” Guajardo said at a press conference held in advance of several trade negotiation meetings between the EU and Mexico.
“Today it is even more important than ever to send a clear message that we are not going to be paralyzed in spite of the challenge of renegotiating NAFTA. We will continue with our trade strategy because it is key to supporting growth in the Mexican economy.”
Malmstroem stressed each side’s commitment to finishing the accord by the end of 2017. “This is an ambitious but feasible goal,” she said at the press conference.
“We have also agreed to accelerate the pace of negotiations even further, increasing the frequency of our negotiators’ meetings.”
Negotiators will meet every month during the second half of the year. So far they are scheduled for Mexico City on June 26-30, Brussels on Sept. 25-29 and again Mexico City in late November to complete the negotiations.
Both trade ministers emphasized that the new agreement will reflect the latest developments in trade agreements, including sections on labor and environmental standards and e-commerce.
The EU-Mexico negotiations started last summer to update the existing free trade agreement from 2000 to the same level planned for the U.S.-EU Transatlantic Trade and Investment Partnership (TTIP), which stalled last year when talks reached an impasse over key issues such as procurement and investor-state dispute settlement. The EU reached such an agreement with Canada in the Comprehensive Economic and Trade Agreement (CETA).
Malmstroem said the modernized EU-Mexico trade pact will be broader and more far-reaching.
Harmonizing sanitary regulations, and defining terms for intellectual property, currency conversion and sustainable development are the some of the themes being hashed out in this particular meeting, Guajardo said.
The talks are part of Mexico’s broader strategy to reduce its reliance on trade with the U.S. as a bargaining chip in the NAFTA negotiations. Mexico is also pushing for a strengthening of the Pacific Alliance and trade with Brazil and Argentina. Mexico also has expressed interest in efforts to continue talks on the Trans-Pacific Partnership, which no longer includes the U.S. after President Donald Trump withdrew the country from participation in that agreement.
Trade between Mexico and the EU has grown significantly as a result of their original accord, from $20.8 billion in 2000 to $61.7 billion by 2017, according to Mexico’s Economy Ministry. However, it is still dwarfed by the roughly $600 billion a year of trade between the U.S. and Mexico.
A new agreement in 2017 would not go into effect until sometime in 2018 at the earliest, Malmstroem said, noting that it will still need to have the technical terms worked out and will need to be translated into all EU languages before being finalized.
Guajardo was also upbeat about the prospects of the agreement even if a protectionist president were to be elected next year in Mexico, noting that Mexico’s laws make it difficult for any one leader to cancel trade agreements.
“Any changes to the agreement will have to be voted on by the Senate,” Guajardo said. “Regardless of who wins the election, they will not have an absolute or qualified majority.”
Mexico trade officials also plan to continue sugar talks next week in Washington, Guajardo said, in response to questions at the press conference about the progress of the negotiations.
Mexico and the U.S. are negotiating new terms for sugar trade to replace a 2014 suspension agreement that established specific volumes that Mexico could import to the U.S. Both sides met in late April but were unable to reach an agreement and have agreed to extend a final deadline to June 5 for new terms.
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