Mexico will initiate trade dispute against the US if they approve electric car initiative

The Ministry of Economy assured that Mexico will initiate a controversy panel under the T-MEC and the World Trade Organization (WTO), and even will impose retaliation If the United States Senate approves the initiative by which incentives will be given to the production of electric cars in US territory, as it is in violation of and contrary to multilateral and bilateral commitments.

The head of the dependency, Tatiana Clouthier, affirmed that this proposal that is being discussed in the United States Senate not only goes against agreements and treaties, but will also promote migration to state United.

Although for now it is an initiative, “in case the proposal is approved and instruments of tax credits by the United States are approved, Mexico will resort to legal instruments at its disposal to enforce our rights.”

What you are trying to vote for is give incentives to those who manufacture in the United States electric cars , with batteries and cells made in that country, that operate with unionized workers, with 50% of domestic content.

All of them are conditions that are prohibited before the World Trade Organization, and they go against the Treaty between Mexico, the United States and Canada (T-MEC).

Proposal is discriminatory

“This proposal is discriminatory or would it be discriminatory Mexican exports of electric vehicles and it would put them at a disadvantage compared to vehicles produced in the United States. An issue that initially contravenes the very purpose of the T-MEC”, Said in conference.

In addition to the fact that it goes against the competitiveness of the region and “increases exorbitantly” migration because workers will seek the possibility of having better horizons in the United States, we are not talking about population.

The now initiative will affect 1 million workers, because although it is expected to become effective until 2027, it encourages companies to establish themselves in the United States.

The US senators will discuss it until December 13, so before that happens they will talk with all the legislators of that country to expose them that the proposal is in violation of the commitments signed before the OMC and the T-MEC.

He added that the proposal includes an incentive of $ 13,000 per unit, something that would affect the Mexican industry.

“It is not worth it, it is not worth it, let’s be playing that we are partners, when it suits me, and when not, I apply it through the obscure way, because we are talking about that the measure would come into force in 2027 ”, for that reason, he warned that if they approve it start a commercial conflict against that country and will even impose tariffs, as commercial reprisals.

The start of T-MEC mechanism It implies that they will be asked to begin with the consultation stage and, if there is no response, a panel will be formed, as was done with the rules of origin of cars against the United States.

For her part, the Undersecretary of Foreign Trade, Luz María de la Mora, said that it is an issue that is evaluated with “Canada, Japan, South Korea, the European Union, because it is a measure that it could turn out to be the opposite in the World Trade Organization ”.

Because the type of tax credit of $ 13,000 is conditioned on the car containing 50% of domestic content, which is assembled in the United States, among other things that are prohibited before the WTO.

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