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US, Canada, Mexico Meet on Thorny NAFTA Issues
Reuters 5/28/2002

PUERTO VALLARTA, Mexico (Reuters) - Trade officials from Mexico, the United States and Canada opened talks at a Mexican beach resort on Tuesday, intent on hammering out several issues which have nagged their free-trade pact. "This will be a multilateral meeting, between the three countries, but it will revolve more around a series of bilaterals," said a Mexican trade official of the meetings that were to run through Tuesday at the Puerto Vallarta beach resort.

The North American Free Trade Agreement (NAFTA), which has bound the three countries since Mexico joined in 1994, has been accredited with boosting commerce in the region to unprecedented levels, but is still troubled by several trade disputes.

For Mexico and the United States, relations have been strained in recent months as each side stands its ground in prolonged and sometimes acrimonious disputes over sweetener and trucking issues.

For Canada and the United States, trade ministers from the two countries are expected to discuss an ongoing dispute over access of Canadian softwood lumber to U.S. markets.

And Mexico and Canada will both make their objections clear over the recently-passed U.S. farm bill that raised subsidies to a host of U.S. agricultural products, officials said.

Despite talk of behind-closed-doors consensus about what must be done to resolve Mexico's demands for greater access of its sugar exports to U.S. markets and U.S. demands for greater access to Mexico's lucrative soft-drinks industry for its corn-syrup exports, each country has publicly shown increased determination to limit the other's access.

In April, Mexico announced a "kilo-for-kilo" policy of limiting U.S. corn-syrup access to how much sugar it is allowed to export to the United States.

Meanwhile, a dispute over access to U.S. roads for its trucks has led to calls from Mexican industry to respond with similar blockades against U.S. trucks on Mexican roads.

"As we've said many times, just as we did with (high fructose) corn syrup, we will apply a mirror policy," if the United States does not grant Mexican truckers access to U.S. roads, Economy Minister Luis Ernesto Derbez said last week.

Canada, which supplies about one-third of the United States' softwood lumber for home building, is complaining about anti-dumping restrictions to access the $10 billion market in the United States. The issue is now before a NAFTA panel set up to rule on trade disputes between the three member countries.

In broader terms, Mexico's Derbez, U.S. Trade Representative Robert Zoellick and Canadian Minister of Trade Pierre Pettigrew, are also expected to discuss macroeconomic issues under the NAFTA agreement.

These include investment protection concerns under Chapter 11 of the treaty and obstacles to trade under an NAFTA-Plus initiative led by Mexico. Communications are also expected to top the agenda, according to sources in Mexico's Economy Ministry.

The discussions will revolve around issues of sovereignty and "ecological concerns", a spokesman said


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