(OTTAWA) The Trudeau government is taking a mixed approach to Mexico charting its own path to economic growth, as the desire for more trade and better labor rights clashes with mining reform and the agricultural regulations that irritate Canadian businesses.
Ahead of a visit this week by senior Mexican officials, Federal Labor Minister Seamus O’Regan was in Mexico this month to provide an update on the country’s growing labor movement, which is undergoing major reforms. with the help of Canada.
“What the Mexican government is doing is incredible,” O’Regan said in a recent interview. “I can’t imagine a society moving forward that fast. »
The changes stem from the replacement of NAFTA with the Canada-United States-Mexico Agreement (CUSMA), which was signed under the Trump administration in 2018.
CUSMA is calling on Mexico to improve worker, union and collective bargaining rights, as there is also pressure to keep wages low in the United States to compete with its neighbor to the south.
These provisions were enthusiastically adopted by the administration of Mexico’s populist center-left president, Andrés Manuel López Obrador, often referred to as AMLO. The country has signed thousands of new agreements governed by a host of brand new labor courts.
The Mexican government said it had reviewed or signed 20,000 contracts, and another 15,000 were in consultation. According to the Mexican government, these changes increased pay by an average of 20%.
“They tore up just about every collective agreement in Mexico, because they favored employers, some of whom were corrupt. They are now encouraging the creation of new unions,” said Minister O’Regan.
The Canadian Labor Congress and unions such as Unifor and the United Steelworkers have helped their Mexican counterparts negotiate the language of these agreements and advised Mexico on its new labor courts. Charities such as World Vision have also been involved in monitoring the country’s efforts to eradicate forced labor from Mexican supply chains.
Mr. O’Regan’s ministry has also sent two envoys to the country to monitor the progress of the reforms. This is, according to him, the first time that Canadian labor attachés have been posted abroad.
Mexico is Canada’s third-largest trading partner after the United States and China, accounting for nearly $50 billion in two-way trade last year. Mr. O’Regan said the relationship is not just about trade, but is also based on shared values around proper labor standards, which the Liberals have put at the center of trade deal negotiations.
“All levels of government are under incredible stress and pressure; expectations are high,” he said of Mexico. “They still have a long way to go, but they are making tremendous progress. »
The Business Council of Canada hopes for a similar collaboration between large companies in both countries. Together with its Mexican counterpart, the Council asked the governments of the two countries to develop a strategy aimed at strengthening the competitiveness of the manufacturing sectors, increasing investment in priority sectors and ensuring that the provinces collaborate more with the States. mexicans.
These issues are likely to be addressed this week, when senior officials from both countries meet to take stock of trade, investment and skilled labor in what is officially called a high-level economic dialogue. level.
But those talks could run into hurdles, with AMLO’s government reforming the mining sector.
Mexico is the world’s largest supplier of silver, an essential metal for electric vehicles and solar energy. Like many countries in Latin America, it is trying to improve community benefits by supplying these metals to companies based in countries trying to become less dependent on China.
At the end of May, Canadian Trade Minister Mary Ng said in a press release that Canada remains concerned about mining reform, which would strengthen company requirements for local remuneration and transparency, while aiming to limit speculation in the sector.
Canada is a global hub for mining companies, many of which focus on exploring for minerals and buying rights to an area of extraction, called a concession, which can be owned and eventually sold to another company. The reform reduces the maximum duration of these concessions and makes it possible to cancel some of them if no mining activity is undertaken within two years.
Canadian companies have warned that the reforms could violate CUSMA as well as a Pacific Rim trade agreement of which the two countries are members. Tamino Minerals pulled out of Mexico in April citing “political instability,” and others have threatened to do the same, particularly after Mexico nationalized lithium reserves last year.
In a statement, the Mexican Embassy in Canada said the changes in the mining sector are aimed at “reducing the impact on the environment, ensuring the conservation of water for human consumption and protecting local communities.” and indigenous peoples – issues that are part of the common priorities of Mexico and Canada”.
The embassy also praised the “crucial” efforts made by big business to strengthen ties between the two countries.
“Traditionally, dialogue between companies has taken place in a trilateral context. However, to harness the full potential of the two countries’ engagement, we need a direct dialogue that takes into account the benefits of a stronger partnership,” the embassy wrote in the statement.
According to the embassy, this can contribute to supply chains and innovation, but also to sustainability and economic growth for underrepresented groups, such as women and indigenous people.
Last Friday, Canada joined a U.S. CUSMA challenge to Mexican laws that ban the use of genetically modified corn in tortillas and pasta, a change that the Grains Council says of Canada, is not based on scientific data.
Mexico has also asked Ottawa to resist Washington’s call last spring to consider reinstating visa requirements for visiting Mexican citizens, which ended in 2016. The US Secretary of Security interior, Alejandro Mayorkas, hinted to the media that the visa requirement could help stem illegal immigration.
