EU agrees trade deal with Mexico
Following the recent negotiations to secure a trade deal with the Mercosur trade bloc, and the deal reached with Japan last year, the EU has agreed on a new trade agreement with Mexico. The current agreement between the EU and Mexico has been in place since 2000. Since being introduced, trade between the two has risen at a rate of around 8% per year. This has resulted in an overall increase in the trade of goods of 148%. These are very positive results, however, the EU and Mexico hope that the new agreement will help to boost trade further by eliminating tariffs on “practically all” goods going forward.
The commission’s announcement noted that the deal, which has now been agreed in principal, will simplify the customs process and remove tariff on a range of products, including farm products, investment and government procurement, and a larger number of services. Once the deal is finalized, it will mean that most EU goods in Mexico will be duty free, including food and farm products. It will also include new provisions designed to improve labour, safety and environmental standards, as well as to help fight corruption.
European Commission President Jean-Claude Juncker said in a statement: “Trade can and should be a win-win process and today’s agreement shows just that. Mexico and the EU worked together and reached a mutually beneficial outcome. We did it as partners who are willing to discuss, to defend their interests while at the same time being willing to compromise to meet each other’s expectations. With this agreement, Mexico joins Canada, Japan and Singapore in the growing list of partners willing to work with the EU in defending open, fair and rules-based trade.”
Commissioner for Agriculture, Phil Hogan, added: “This agreement proves yet again the value of the EU leading from the front globally in promoting open and rules-based trade. Our commitment is to deliver benefits for our citizens at home through closer cooperation with our partners abroad. This deal is very positive for our agri-food sector, creating new export opportunities for our high-quality food and drink products, which in turn will create support more jobs and growth, particularly in rural areas.”
As well as the new deal being good news for EU nations, it’s also seen as a positive step for the Mexico. As the President Trump continues to push for the rewriting of the North American Free Trade Agreement, which was also introduced in 2000, Mexico wants to reduce its reliance on US exports. At the moment, 80% of Mexican Exports go to the US. With uncertainty over the future of the NAFTA, along with the prospect of added tariffs to products, a deal with the EU would be welcomed by the Mexican government.
Mexican Economy Minister Ildefonso Guajardo said: “It needed to be more ambitious in the agricultural sector, it needed to be more ambitious in services, it needed to be more ambitious in many of the elements that in the end we managed to agree on after two years of work.” EU and Mexican negotiators are currently working on the technical details of the deal, and hope it will be finalized by the end of the year.