Bonn urges EU to begin trade talks with Mexico

Date: 09/05/1996

EU governments now appear closer to agreement on setting in motion talks on a free trade accord with Mexico.

For months, foreign ministers have reined in Commission negotiators anxious to start talks with their Mexican counterparts, fearing the consequences for EU trading relations with the rest of the world.

But the subject is now back on the front burner, thanks in part to pressure from German Foreign Minister Klaus Kinkel, who will try to persuade fellow ministers to push the talks along when they meet next Monday (13 May).

EU ambassadors have now seen the results of a Commission study on the impact such a trade pact could have.

The 50-page paper maintains that the trade agreement as foreseen would be compatible with global rules established by the World Trade Organisation (WTO) - although it warns that Union negotiators will have to be careful to keep within WTO rules as they hammer out a deal.

The study says Mexico's free trade zone with the United States and Canada (NAFTA) would not cause complications in the creation of an EU-Mexico trade channel.

It also repeats earlier findings by independent studies that opening European markets to Mexican goods would have no adverse effects on EU producers. Commission officials studied agriculture, fisheries and industrial sectors, and concluded that Mexican imports would have less impact than trade agreements already foreseen with Central and Eastern European or Mediterranean countries.

“That argument is strongly defended by the Europeans themselves,” said Mexico's ambassador to the EU, Manuel Armendariz Etchegaray. “That is a point in our favour.”

Officials say the study has reinforced the arguments of Spain, the UK and others who want the Union to agree to liberalised trade from the outset, rather than applying the approach taken towards the Mercosur bloc of Argentina, Brazil, Paraguay and Uruguay. The EU and the four Latin American countries recently agreed to discuss free trade at a future date.

But opposition to promising Mexico a free trade deal is still strong in several EU member states, notably France.

Fears in Paris that such a deal would harm French farmers have largely subsided, but France's EU ambassador is still arguing loudly against the proliferation of free trade agreements the Union is pursuing around the world. Diplomats say the ambassador was not swayed during a meeting last week by reminders that free trade with Mexico was an initiative launched by the then French Foreign Minister Alain Juppé.

Mexico City opposes the two-stage approach taken with Mercosur. “We believe that, once we take the decision on liberalisation, that should commit both sides,” said Armendariz, adding that Mexican negotiators did not want to find themselves obliged to submit negotiating results as they went along in order to get permission to go further.

He also stressed the need for a trading partnership encompassing all sectors. “We want to put everything on the table,” said Armendariz, explaining that if sensitive points arose during talks they could be dealt with, but adding: “We would like not to have to exclude anything at the beginning. What we want is a free trade agreement. If those words are not palatable, we can find other wording, but that is what we want.”

Kinkel, promoting German industrial interests, has been pushing for trade talks to begin and has said he wants his EU colleagues to give the Commission the go-ahead this month. “Mexico is the ideal partner for us,” Kinkel told President Ernesto Zedillo during an official visit to Mexico City last week.

Adding that Mexico's economic recession last year had not scared off German industrialists, Kinkel said Bonn favoured a trade pact being signed “as soon as possible”.