Mexico Expands Retaliatory Tariffs in Trucks Dispute

Mexico stepped up its pressure on the U.S. in the dispute over cross-border trucking on Monday, expanding the list of American goods that will be hit with punitive tariffs.

The action comes a year after Mexico hit U.S. goods with some $2.4 billion in tariffs in 2009 after Congress killed a program giving Mexican trucking companies access to U.S. highways. U.S. transportation officials have said they were working on a new cross-border program to meet congressional concerns about safety and the impact on American trucking jobs, but they have not completed a new truck plan.

Mexico now plans to add 10 new products to its list of punitive tariffs. Those products are expected to include pork, oranges and chewing gum, according to a Bloomberg report. The tariffs affect products from grapes to frozen potatoes.

The announcement came as President Obama signed a $600 million bill to increase security on the U.S.-Mexican border and add customs officers at ports of entry.

U.S. manufacturers and food growers are pressing Congress and the Obama administration to act on a long-delayed replacement cross-border trucking plan.

“Ignoring the trucking issue and failing to abide by our trade commitments has real economic costs,” said Bill Reinsch, president of the National Foreign Trade Council.

The U.S. and Canada are required to open their highways to Mexican trucks by the North American Free Trade Agreement. Canadian trucks operate freely on U.S. highways, but under cabotage restrictions cannot haul intra-U.S. freight.

Mexican trucks are allowed to operate only within a 20-mile border commercial zone. The cross-border trucking program started under the Bush administration allowed a limited number of Mexican carriers access to the U.S. similar to that enjoyed by Canadian carriers.

U.S. Trade Ambassador Ron Kirk said he was “disappointed” by Mexico’s decision to expand its retaliatory tariffs and said the U.S. is committed to resolving the issue.

Transportation Secretary Ray LaHood has said several times a new cross-border trucking plan would be ready “soon” for review by Congress.

But the administration must overcome strong opposition from many Democrats, the Teamsters union and the Owner-Operator Independent Drivers Association.

Industry groups, including the U.S. Chamber of Commerce and the American Trucking Associations, favor reinstating a cross-border trucking program.

Contact William B. Cassidy at wcassidy@joc.com