Senate sees passage of USMCA-critical bill by April 30

Mexico’s senate continued debate on a critical labor reform package Tuesday with eyes on passage before the end of the regular session ending April 30. The government walks a tightrope toward ratification of the USMCA agreement to replace Nafta amid rising trade tension from US actions at Mexico’s northern border.

Senate president Martí Batres of President Andrés Manuel López Obrador’s (AMLO) Morena party confirmed two senate committees were now reviewing the legislation, passed in the lower house April 11, and stressed that the bill should complete the legislative process by the end of the month.

With the bill lawmakers want to modify the labor law to conform to the USMCA agreement signed by Mexico, the US and Canada in November. Batres acknowledged that the legislation has been under pressure from US congress which demands quick passage to provide confidence on the matter.

"I consider it important for the country that we are resolving the labor reform in this session’s period,” said Batres, as reported in local daily El Economista. “It is important because our next session is not until September, and we have responsibilities with the country to the workers. It is important for the certainty that this generates.”

Message to Trump

As senators move forward, Mexico’s foreign ministry has announced it would be sending a report, made in coordination with the governments of the nation’s northern states, detailing the multiple economic costs generated from recent delays at crossing points along the US-Mexico border.

US President Donald Trump‘s administration has stepped up anti-Mexico rhetoric in March and April in a broad conflation of anti-immigrant politics and trade policies with Mexico, including threats to expand tariffs and/or close the border in addition to slowing down cross-border trade. The rhetoric raised alarms with business groups and local governments along the 3,145km frontier.

“Stopping the flow of goods and the transit of people is a detriment to our economies and to the competitiveness of the region,” said the foreign ministry in a statement Monday. 

“Consequently, the foreign ministry will reiterate to the US authorities the urgency to expedite the transit of goods, as well as to deepen mutual cooperation to guarantee the efficiency and security of our common border. The economic spillover generated by the value chains between both countries should not be underestimated,” the ministry added.

According to the ministry, in the first two months of 2019, Mexico has positioned itself for the first time as the US’ largest trading partner.

The impact has been felt on both sides.

In a Wilson Center webcast on the crisis, Paola Avila, head of international business affairs at the San Diego chamber of commerce said, “30 days of this doubling of wait times is hugely detrimental, and again we don’t need to try and run numbers to figure out what the impact might be, we already know what that impact has had on our border regions.”

Citing a chamber analysis of a sustained two-hour delay at the border, Avila said in such a case, “San Diego loses US$2.9bn a year, or 40,000 jobs, and that’s just here regionally … Across the nation its US$7.2bn just from border delays, not to mention border closures.”

Pictured: Cars and trucks line up at the San Ysidro crossing port to cross from Tijuana in Mexico to San Diego in the US on April 4, 2019.