Trade talks between the United States and Mexico have slowed after resistance from US Commerce Secretary Howard Lutnick, the Wall Street Journal reported, citing people familiar with the talks. Washington and Mexico were close to an agreement to reduce tariffs on steel, aluminum and cars in exchange for concessions from Mexico.
According to the publication, Lutnick opposed a significant reduction in the 25 percent tariff on Mexican cars. He also objected to a significant reduction in the 50 percent tariffs on steel and aluminum, as well as lower rates for finished products made from both metals. It is these disagreements that have slowed progress on the agreement, Reuters reported.
Mexico sees progress in talks
Mexico's Deputy Economy Minister Luis Rosendo Gutierrez told the Wall Street Journal that there was progress in the negotiations. On the US side, a spokesman for the Commerce Department said that the department was in constant dialogue with Mexico on trade issues. “The department is in constant dialogue with Mexico on trade issues”, the spokesman said.
The Mexican Economy Ministry and the US Commerce Department did not immediately respond to Reuters requests for comment on the information. Therefore, the claim of blocking the deal remains based on information from unnamed participants and people familiar with the talks, and not on an officially announced termination of negotiations.
The dispute is related to the review of the North American Agreement
The talks are part of the broader negotiations surrounding the review of the United States-Mexico-Canada Agreement. Mexico is demanding changes to US tariffs on cars and metals, calling the levies on steel and aluminum unjustified. Mexican authorities also emphasize the importance of integrated production chains in the North American auto industry.
US tariffs on Mexican cars are 25%, while rates on steel and aluminum reach 50%. Their possible reduction is among the key conditions for progress on the deal, but Lutnik's position for now limits the possibility of a significant concession from Washington.
Sources: investing.com, gvwire.com