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American Shipper

Mexico prepares to pressure U.S. on cross-border trucking

Mexico prepares to pressure U.S. on cross-border trucking

U.S. Transportation Secretary Mary Peters and a coalition of 69 U.S. companies and business groups on Monday urged Congress not to kill a demonstration program for long-haul Mexican trucks service because Mexican retaliation could harm U.S. exports.

   Congress late last year included language in the department’s appropriation bill that essentially defunds the pilot program allowing registered Mexican-domiciled truck companies to move goods from Mexico across the border, and deliver them via U.S. highways. To date only a handful of the project's projected goal of 100 Mexican trucking firms have been certified to operate in the United States. A portion of the program grants reciprocal rights for U.S. trucks to operate in Mexico.

   The plan has met fierce opposition from labor, trucking and public safety groups, with most citing U.S. job losses and inadequate control of safety regulations on Mexican trucks and drivers as main concerns.

   Most Mexican trucks are confined to a 20-mile zone along the southern border where they must transfer their loads for U.S. trucking firms to move into the interior of the country.

   Some lawmakers are angry that the Bush administration has ignored their will and are seeking to stop the program until more safeguards are put in place. The DOT said the program has a full complement of inspectors, satellite tracking, and other procedures to ensure that Mexican trucks safely operate on U.S. highways.

   Under the North American Free Trade Agreement, Mexico has the right to impose fees and tariffs on $2 billion worth of U.S. goods if the border isn’t completely opened to trucking. Agriculture and business groups, including the National Association of Manufacturers, the American Farm Bureau and the Corn Refiners Association, say Mexican retaliation would harm U.S. exports. Peters added that U.S. trucking companies would also be restricted from the Mexican market, although U.S. carriers have shown cautious interest in using their own equipment south of the border.

   NAFTA was fully implemented on Jan. 1. U.S. food and agriculture exports have more than tripled to more than $12 billion per year as tariffs have been eliminated.

   According to a report by Dermot Hayes, an economics professor at Iowa State University, Mexican officials are compiling a list of industrial sectors and finished products in 17 key U.S. states that would be the target of any taxes. Most of the products selected are easily available from other countries to prevent harm to Mexican consumers and businesses.

   Products on the draft retaliation list include almonds from California, shampoos and sunglasses from Illinois, scrap batteries from Wisconsin and printed books from New York.

   The U.S. economy would suffer more than 10,000 job losses under a scenario in which trade restrictions are imposed on $500 million of U.S. trade and nearly 41,000 jobs in the unlikely event that Mexico retaliated against all exports.

   Peters is scheduled to testify today about the cross-border trucking program before the Senate Commerce, Science and Transportation Committee. ' Eric Kulisch

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