Mexico Pressures US to Avoid Congressional Ratification of Agreements

This Friday, specialized press in the United States published a note stating that the Mexican government will pressure the U.S. government to obtain guarantees that what is agreed upon will not be subject to congressional ratification. On the other hand, Mexico's stance reflects a lack of effective communication channels with both chambers of Congress and the distancing from the Capitol. For the agreed-upon changes not to be subject to ratification, much will depend on their nature and content, which is why there are rumors of splitting the negotiation into a series of agreements, each on a specific topic. Mexico would face an unknown process, even for the United States, which could increase the political cost of the negotiation. Mexico has stated that one of its main objectives is to eliminate the tariffs that Trump has established so far: what would the arguments be for removing them? In Washington, it is commented that the USTR has refused to discuss the issue, which in turn has stalled talks on non-tariff Mexican barriers. Therefore, the United States proposes to negotiate separately the multilateral agreement on critical minerals, which is key for Trump and to which Canada opposes because it is one of its main bargaining chips, a position that Mexico should follow. If Congress does not intervene, Trump could argue that the private sector would not have to establish objectives for the negotiation, as when negotiating the TPA, and the USTR would not be subject to reporting regularly to the Capitol. Thus, the negotiated text would not be changed by a comma, but the last-minute changes promoted by various legislators to vote in favor of the treaty carry very particular benefits for their district or state. Trump does not want congressional intervention because he considers that the objectives that would have to be set for the approval of a new Trade Promotion Authority (TPA) could hinder him, but above all because any change he attempts to make would be subject to the approval of both chambers of the legislature, especially since he expects that starting in January he will lose the majority in at least the lower house. The Mexican government's position can be explained because after the negotiation of the 14 free trade agreements that the United States currently has in force, including USMCA, the ratification process, which requires the approval of both chambers, has involved changes to the negotiated terms that are included in the law passed for its implementation in that country. Before the end of the month, the USTR must send its 2026 report to the Capitol, which will allow the status of this issue to be known. However, this will not prevent legislators from continuing to present proposals, especially with the November elections. The Biden administration set a precedent by avoiding that the agreement it reached with Japan on strategic minerals be subject to ratification, arguing that it was a 'very specific issue' and that it would not have a 'direct' effect on the public treasury, otherwise it would have been subject to congressional intervention. With the start of negotiations between Mexico and the United States, three variables will largely determine the content and future of the new treaty, which will have little of a trilateral nature and will incorporate new topics that seek to guarantee both the preeminence of the United States and minimize Chinese influence in the hemisphere. An example of this are the changes in labor and environmental matters agreed upon at the National Palace in 2019. Greer insists that any treaty will include tariffs and argues that the investigations under Section 301 published last week, as well as the current tariffs, are not part of the talks with Mexico. His solution will have effects for attracting new investments not only from North America. The third variable is Canada's participation in the talks, which we will discuss in the next installment. Today, China is the number one or two source of imports for all countries in the Western Hemisphere, with the exception of the United States, where it ranks third, but for all it is the main supplier of rare earths. The first and most important is that the U.S. Congress ratifies the agreed-upon changes. Even, depending on the topics agreed upon, it may be necessary to approve an implementation law. The second is the inclusion of tariffs.