Mexican Economy Minister Suggests Auto-Related Uniform Regulations Won't Be Ready by July 1

Mexico's Economy Minister Luz de la Mora said that the uniform regulations that pertain to issues outside the auto industry will be ready by July 1 -- but strongly suggested that the uniform regulations will not be ready by the date of entry into force of the U.S.‐​Mexico‐​Canada Agreement. “There has been great progress on non-auto URs, and they will be ready by July 1, as for the auto rules of origin, we expect to advance substantially in coming weeks,” she said during a Cato Institute interview May 27. She said that Mexico wants “to make sure the transition to the new regime is effective, efficient.”

She also said that “we understand this is something that will transform dramatically the way in which the auto industry in North America has to comply with the new regime. This is not minor.”

The economy minister noted that when NAFTA came into force, the uniform regulations were not finished for another 20 months.

De la Mora also laid out a number of actions that still need to be done, some of which were complicated by the fact that Mexico's Congress shut down during the COVID-19 pandemic. “We are still working to amend infrastructure quality law, industrial property law, copyright law, criminal code, plant variety law, and import and export tax law,” she said. She said that Mexico still needs to select panelists both for dispute settlement and for the rapid response labor mechanism.

She said it's also a challenge to implement the customs and facilitation chapter of the agreement.

Cato moderator Inu Manak asked de la Mora about the new provision in USMCA that requires countries to disclose to the others in the pact the details of their negotiations with non-market economies. Manak noted this seems to be focused on China. When it was first published, analysts had thought the provision was pushed by the U.S. to prevent Canada or Mexico from arriving at a free trade agreement with China.

De la Mora, who functions as foreign trade minister, replied that “the country that we have seen most active with respect to China is the U.S.,” and that on July 1, Mexico will request formally to the U.S. to see the content of its phase one trade deal with China. “It will be important to us to know the details of that agreement,” she said, because it may impact Mexico “with respect to trade diversion,” or because of tariffs on Chinese goods.