President Barack Obama and Mexican President Felipe Calderon have reached an agreement to resolve the dispute over cross-border trucking. The dispute erupted in March 2009 when Mexico placed higher tariffs on an estimated $2.4 billion of U.S. goods after the U.S. Congress cut off funding to renew a pilot program that let a limited number of Mexican trucking companies to haul freight beyond a 25-mile U.S. commercial zone.
Mexico had instituted tariffs in retaliation for the United States not complying with the trucking provision of the 1994 North American Free Trade Agreement (NAFTA). The provision was supposed to become effective in December 1995.
Half of the $2.4 billion in Mexican retaliatory tariffs are to be lifted as soon as the agreement is finalized. The remainder of the tariffs will be lifted when the necessary safety tests are completed and the first Mexican truck rolls across the U.S. border, according to a statement from the American Farm Bureau Federation.
AFBF president Bob Stallman said it is important for trading partners to know that the United States lives up to its commitments under trade agreements. "Re-establishing a reciprocal cross-border trucking program will go a long way toward restoring our credibility and our relationship with a vital trade partner," he said.
Opponents of the NAFTA trucking provision claim there are safety issues with Mexican trucks, but available data, including data collected as part of the pilot program, demonstrate the safety of Mexican trucks, which must meet U.S. standards, said a statement from the National Pork Producers Council (NPPC).
“I have no doubt the data generated under the new agreement will show that Mexican trucks are safe,” said NPPC president Sam Carney. “It is imperative that Congress support this agreement. Any attempt to stop or otherwise undermine the agreement will invite Mexico to reinstate retaliatory duties on pork and other products, causing the United States to lose exports and jobs.”
Mexico is the nation's third-largest agricultural export market. However, as Stallman noted, farm and ranch exports to Mexico have been hampered by the dispute and retaliatory tariffs. "The impact has touched a wide range of farm products from every state. Our competitors are filling the gap. This is not in our economic best interests. One of the straightest roads to economic growth and job creation in the U.S. is for members of Congress to get behind the agreement announced today, and we urge them to do so," Stallman said.