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Weekly Report - 26 August 2021 (WR-21-34)

​MEXICO: Defending its auto industry

The Mexican government has formally requested consultations with its US counterpart over the interpretation and application of the new rules of origin for the automobile sector set out in the US-Mexico-Canada Agreement (USMCA) on regional trade. The USMCA was adopted after the previous US government led by Donald Trump demanded a renegotiation of the North American Free Trade Agreement (Nafta), which it considered to be unbalanced, offering more advantages to Mexico and Canada than to the US. To redress this, the US called for changes to the rules that govern trade between the three countries. The US said that the aim was to make these more balanced so that they equally benefit all three countries and promote the economic development of the entire region. But Mexico is concerned that the US interpretation of the new rules for the auto sector will harm the national as well as regional industry.

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