President López Obrador Rejects Pelosi's Request for U.S. Labor Supervisors in Mexico
LPO anticipated the inspection plans for the House to ratify the USMCA. The Mexican President recognized there are still questions on the enforcement of the Labor Reform.

The ratification of the USMCA trade agreement seems to be, once again, pending from a thread. The demands from Democratic Party lawmakers regarding labor reform have toughened and Mexico's position is unclear: the Government will not accept their demands and will fight their counter-proposals. On Tuesday, President López Obrador confirmed that he has already rejected the proposal to have labor supervisors in the country.

"They are posing that there might be supervision on the compliance of the law. We do not accept inspectors in any company", said the president during his daily press conference. He explained that behind these proposals are questions on the enforcement of the new Labor Reform.

The Democrats' proposal for supervisors was being pushed since August. Back then, LPO revealed the intense lobbying by Ambassador Christopher Landau with Mexican industrials in order to obtain guarantees regarding the enforcement of labor laws to start with the USMCA ratification in the House of Representatives.

Mexico's López Obrador to Pelosi: "We've met all of your demands, it's time to ratify the USMCA"

The aim was to find ways to convince Nancy Pelosi that the López Obrador administration will comply with the labor laws approved by the Mexican Congress.

Since then, the proposal was already being pushed by Pelosi's closest senators, Sherrod Brown and Rod Wyden. The idea was to form a group of U.S. inspectors to verify the compliance of Mexican companies with the agreements signed on the USMCA regarding labor: union freedom, elimination of poor work conditions, adherence to the International Labour Organization's guidelines, among other priorities.

On Tuesday, López Obrador said that Democrat legislators assured him that these demands have nothing to do with mistrust towards the administration, but that "they do not know what is going to happen next, and they want to point it all out".

What the Mexican Government is proposing instead is that, should a controversy arise regarding a company in Mexico (and not in the entire business landscape in the country) a panel might be formed. "We will work together so that, if the law is broken, during a considerable amount of time, a panel will take action", the president explained. The idea is that said panel has to be formed by three specialists: one proposed by Mexico, another one by the US, and a third one who would be independent. They would decide if there was or not a breach.

"That's what we are evaluating right now. We don't want more time to pass by, because of the effects that the electoral process [in the U.S.] might have", he added. Nevertheless, he did recognize that it is "a complex matter", yet, he assured that it is being addressed and he recognized Jesús Seade's work, his chief negotiator.

Pelosi's Reform Demands Spark Conflict Between Mexico's López Obrador and the Senate

On Monday, Mexico's Business Council revealed that there were "extreme" demands coming from the U.S. which were "unacceptable". Due to the negotiations, business leaders did not go into details, except on the issue of external supervision, to which they firmly said no.

The complications in the negotiations have increased anxiety on the possibility of achieving a new trilateral trade agreement soon. This morning, Gustavo de Hoyos, chairperson of COPARMEX, tweeted that "President López Obrador must display temperance and he must not transgress because of pressures from radical groups in the U.S. To do so would be a betrayal to Mexico".

Moisés Kalach, the Strategic Consulting Council for Negotiations coordinator at the Coordinating Business Council, explained that "the only thing that prevents this situation from reaching success are some demands from the American Government. We think most of them are coming from the Democrats' side".

On a radio interview for MVS Noticias, he said that they are not willing to concede. "These demands are opportunistic, and they come from opposing groups who do not see us with good eyes in terms of commerce".

López Obrador insists that his administration has already complied with the Labor Reform and that he was in line with the principles his government promotes: "That there are no leaders without jobs, fake unions, no corrupt leaders. That there are no eternal terms for union leaders. That there is democracy. This has taken us to the approval of a labor reform with these characteristics", he said.

"Those at the Democratic Party, in spite of the reform being approved, have stated that there were going to be instrumental operational problems to take into practice what has already been legislated", the president explained.

Translation: Ernesto Acosta Sandoval.

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