- The Washington Times - Monday, June 16, 2003

The Bush administration yesterday attacked Mexican trade rules that affect U.S. exports of beef and rice.

U.S.-Mexican agricultural trade has doubled since implementation of the North American Free Trade Agreement began in 1994, but a string of disputes has plagued producers on both sides of the border and led to a rising chorus of complaints.

Yesterday’s formal complaint by the United States at the World Trade Organization (WTO) starts a 60-day consultation period on Mexico’s trade policy on beef and long-grain white rice, the U.S. Trade Representative’s Office said.

“Since NAFTA, Mexico has become our third-largest market for food and agricultural products. It is unfortunate that we could not resolve these matters bilaterally. But we have been patient and now must ensure that the trade agreements are fully enforced,” said U.S. Agriculture Secretary Ann M. Veneman in a statement announcing the WTO challenge.

The United States last year exported $829 million of beef products and $103 million of rice to Mexico, the trade office said. U.S. exports of all agricultural products to Mexico reached $7.25 billion last year, doubling since 1993, the year before NAFTA implementation began, according to U.S. Census Bureau figures.

The quick rise in exports of some products has caused some Mexican producers to seek protection.

Mexico in April 2000 said that U.S. beef was being dumped; that is, being imported below the cost of producing it. Last June, Mexico complained that white long-grain rice also was being dumped. Mexico followed with duties that limited the ability of U.S. producers to sell their products.

The United States also has had trade-related run-ins with Mexico over a sweetener commonly used in soft drinks, swine and poultry, and had already filed a case under NAFTA on the beef issue.

“Unfortunately, our dispute with Mexico over these [beef and rice] duties is only the tip of the iceberg, at least with regard to agriculture,” said Montana Sen. Max Baucus, ranking Democrat on the Senate Finance Committee, which has jurisdiction over trade issues.

Officials at the Mexican Embassy in Washington did not return phone calls seeking comment on the case.

NAFTA, signed with Canada and Mexico in 1993, was written to remove tariffs on agricultural products during a 15-year period, and some sensitive products have been affected as tariffs have been reduced or eliminated. Mexican producers also have complained that their U.S. counterparts are heavily subsidized.

“On both sides of the border, you’ve got these groups that are going to get hit when the tariffs are lifted,” said Armand Peschard-Sverdrup, director of the Mexico project at the Center for Strategic and International Studies, a Washington think tank that supported NAFTA.

“On the U.S. side, there’s a little bit of election politics one has to be mindful of. In Mexico, it’s a delicate issue when you consider they are going through a political transition, and a large percentage of the population is still working on farms,” he said. Midterm elections in Mexico are set for July 6.

The United States frequently uses anti-dumping duties to protect domestic industries from foreign competition. But yesterday trade officials said that Mexican procedures and methodology in calculating the duties breaks WTO rules.

“Trade remedies are an essential part of the rules-based international trading system — but they must be used in accordance with those rules,” U.S. Trade Representative Robert B. Zoellick said.

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