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Council of Canadians joins with Mexican civil society to fight “updated NAFTA”

Trudeau  Nieto

Canadian and Mexican civil society groups are calling on Trudeau and Nieto to reject the TPP.

Former Canadian diplomat recently commented that the twelve-country Trans-Pacific Partnership (TPP), which includes Canada, Mexico and the United States, “effectively allows us to update NAFTA”.

The Council of Canadians is working with its allies in Mexico and the US to oppose the TPP. We will be present at an International Meeting of Social Movements to Oppose the TPP on January 27-29 in Mexico City. Mexican social organizations have issued an invitation to “social organizations from Chile, Peru, the United States, Canada, Mexico and from all those countries in the Americas and Asia who are interested in joining forces to oppose the threat of the TPP”. Their outreach for this meeting also notes, “At the same time, we are hoping to hold a Public forum on the TPP in the Mexican Senate on 28 January.”

The Council on Hemispheric Affairs has commented, “[The TPP] is likely to prove disastrous for the Latin American states—Chile, Mexico, and Perú—that have joined the pact up to now. Multinational economic interests based in the United States have exerted extraordinary influence over the accord, inserting language that will arguably serve to damage Latin American interests. …Despite being heralded as a path to prosperity for developing countries, eliminating protectionist measures in countries like Chile, Perú, and Mexico could prove to be very harmful.”

That article adds, “In the aftermath of NAFTA’s inception, two million Mexican agricultural laborers lost their jobs and eight million farmers were forced to sell off their land at fire-sale prices. …The suffering of Mexican farmers under free trade terms is a stirring example of Friedrich List’s ‘kicking away the ladder’ thesis, and should provide a cautionary note for additional Latin American countries joining the TPP. In fact, the World Bank’s poverty headcount ratio metric for Mexico displays a higher proportion of people in poverty there today than before NAFTA’s passage in the early 1990’s, and inequality has widened in the country by several metrics. It is easy to imagine the TPP having similar results for its Latin American members.”

And it concludes, “Creating a favorable climate for business to operate in was clearly a major goal, as was slashing the trade barriers that would force nascent Latin American industries to compete with more developed economies. Only time will tell what the practical repercussions will be, but additional Latin American states should exercise caution while considering joining the Trans-Pacific Partnership.”

In TPP negotiations as recent as September 2015, the Mexican government expressed concerns about the auto manufacturing provision in the deal. As explained by the Globe and Mail, “Mexico ranks second behind the United States and ahead of Canada in annual auto production, and its output is growing every year.”

That article notes, “Under NAFTA, Canada, the United States and Mexico require more than 60 per cent of cars and auto parts to be made within the NAFTA zone in order to enter their markets tariff-free.” But with the Trans-Pacific Partnership, “vehicles would be tariff-free even if only 45 per cent of their content is made within the TPP zone, and auto parts with as little as 30 per cent.”

This could be devastating for both the Canadian and Mexican auto sectors.

Despite this initial opposition, after the TPP agreement was reached in October 2015, Mexican president Enrique Pena Nieto downplayed any concerns and stated, “Mexico already has a strong auto industry. The important thing is to strengthen it further. Mexico’s auto industry will set up supply chains by modernizing distribution networks. It has the capability to compete around the world. Cars built in Mexico will be competitive. They are known for their high quality.” And more generally he commented, “The pact will allow Mexico to diversify its trade and economic relations, opening up a new horizon and giving much impetus to economic integration.”

It is important to build both national and cross-border opposition to the TPP, to connect social movements opposing the TPP in Canada, Mexico and the United States, in order to strengthen our ability to defeat the TPP.

It is expected that the TPP will be signed on February 4 in New Zealand, but that the ratification process will extend well into 2017. On March 10, Prime Minister Trudeau will visit US President Barack Obama at the White House. The TPP will undoubtedly be on the agenda. At some point in March, Prime Minister Trudeau is also expected to welcome President Nieto and President Obama for a “three amigos” summit in Canada.

For more on our campaign to stop the TPP, please click here.