César Ornelas, on future Mexico-US relationship: "This crisis is an opportunity to restructure and have better institutions"

César Ornelas, on the future US-Mexico relationship: "This crisis is an opportunity to restructure and have better institutions"

11/04/2017

Several Mexican and American business leaders met in El Paso to participate in the Supply Chain Summit for Manufacturing in Mexico. On the occasion they referred to the North American Free Trade Agreement, NAFTA, signed 23 years ago between the United States, Mexico and Canada, and were convinced that, despite the threats of the Trump administration, the NAFTA will be renegotiated, but not rescinded.

The forum took place at a time when bilateral relations between Mexico and the United States are at their worst level in recent decades. Trump has said that NAFTA puts US workers at a disadvantage, generating unemployment, and has threatened to impose high taxes on imports from Mexico. The figures of the organizations that support the Trump thesis maintain that the NAFTA caused a loss of 30% of the manufacturing jobs of cars in the United States between 1994 and 2013, although clearly the automation of the industry plays a leading role in this phenomenon .

Those attending the event rejected the possibility that NAFTA will be repealed and said that their sectors will survive despite the threats of President Donald Trump.

They pointed out that "industries should prepare for the changes that come"And clarified that NAFTA has been distorted in its results since it has been very beneficial for the US economy. The Wilson Center, a research center based in Washington DC, warns that nearly 5 millions of US workers will be laid off if trade between the US and Mexico is suspended. Only El Paso, the place where the summit took place, exports USD 21.100 million to Mexico each year, which makes it the largest US exporter to Mexico, followed by Detroit, with USD 17.300 million annually, according to the Wilson Center.

Sergio Ornelas, editor of the Mexico Now group, which organized the event held in El Paso, said that Donald Trump and other organizations have installed the mistaken idea that Mexico is the biggest beneficiary of the North American trade agreement. "Mexico has invested almost two and a half times more, given the economy it has, in the United States, than vice versa," he said.

He maintains that there are indeed parts of NAFTA that could be renegotiated, such as removing entry barriers to the world of television and the media for US companies, or facilitating easier forms of trade. “A new crisis is an opportunity to restructure, have better institutions", he pointed.

Ornelas indicated that the thousand leaders and managers gathered at the event should remain confident about the future of their operations. “Be calm. Have patience. Sell and report on the benefits of NAFTA. We only hear the negative, we only hear the bad guys talk"He added.

without-title-min The trade balance of Mexico showed a deficit of USD 13.135 million in 2016, balance less than USD 14.609 million reported in 2015, according to data from the National Institute of Statistics and Geography, Inegi, of Mexico. The agency explains that this decrease in the deficit, which in sum is USD 1.474 million, originated from the combination of a reduction in the balance of non-oil products, which went from USD 4.495 million in 2015 to USD 312 million in 2016. The truth is that these figures come down from 2013.