Landmark US-Mexico trucking agreement resolves 15-year conflict

After years of wrangling, US and Mexican officials signed an agreement Wednesday that allows trucks from each nation to travel on the other country’s highways – a key provision of NAFTA.

The United States and Mexico on Wednesday signed an agreement aimed at resolving a cross-border trucking dispute. The longstanding disagreement had come to symbolize growing resistance, especially in the US Congress, to free-trade provisions with America’s southern neighbor.

The accord, signed in Mexico City by US and Mexican transportation officials, would end a 15-year-old controversy that on the US side featured fears of unsafe Mexican trucks barreling along US highways, driven by unprofessional Mexican truckers.

On the Mexican side, outrage over the American disregard for a NAFTA provision led to retaliatory tariffs on US goods ranging from pork to consumer care products – which cost the US as much as $2 billion in exports.

The accord was greeted warmly by US trade, farm, and business organizations – but condemned by US trucking organizations, a sign the agreement could face trouble in Congress.

Under the agreement, the US will reinstate a pilot program for Mexican truck certification that was introduced under the Bush administration – and defunded by an angry Congress in 2009. Mexico, in turn, will immediately drop half of the tariffs on about 100 US products, with the rest to be removed when Mexican trucks actually start rolling across the border.

“The agreements signed today are a win for roadway safety and they are a win for trade,” said US Transportation Secretary Ray LaHood after signing the documents.

The accord requires all Mexican trucks operating in the US to comply with US safety standards, and it mandates the installation of monitoring devices to track truck usage and compliance with service requirements.

Recognizing the potential for a negative response from Congress, some supporters of Wednesday’s agreement wasted little time with praise and got right on to warnings against attempts to once again sidetrack the resolution.

“We are encouraged there is finally a positive end in sight,” said Bill Reinsch, president of the National Foreign Trade Council in Washington. But he added, “We urge Congress to refrain from any action that would derail the program or fall short of our commitments under NAFTA.”

Some, who oppose any trucking accord allowing Mexican trucks to come north, continue to hammer at safety concerns.

“Opening the border to dangerous trucks at a time of high unemployment and rampant drug violence is a shameful abandonment of the Department of Transportation’s duty to protect American citizens from harm and to spend American tax dollars responsibly,” said Jim Hoffa, general president of the Teamsters, in a statement. He said the accord “endangers American motorists.”

Mexican trucks are already allowed to circulate in the US within 25 miles of the border. The new agreement will allow Mexican trucks to deliver goods into the US and to return goods to Mexico, but it bars the transport of goods between US destinations.

Both sides in the debate over Mexican trucks are latching onto the issue of the day – jobs – to make their case for or against the agreement.

Secretary LaHood said that by “opening the door to long-haul trucking between the US and Mexico … we will create jobs and opportunity for our people and support economic development in both nations.”

Farmers are particularly happy: Mexico is the second-largest purchaser of US pork after Japan, for example, but pork sales to Mexico have sagged in recent years under the retaliatory tariffs.

But the Teamsters’ Mr. Hoffa says the deal will be a job killer. “The so-called pilot program [for certifying Mexican trucks] is a concession to multinational corporations that send jobs to Mexico,” he said. “It lowers wages and robs jobs from hard-working American truck drivers and warehouse workers.”

The opposing arguments reveal the trucking dispute to be a microcosm of the larger debate in the US over trade. How Congress responds may suggest which way the trade winds are blowing.