Fearing Trump Compliance Demand – Mexico Quickly Looking for Alternatives to Chinese Parts and Components

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Posted on 11/23/2024 3:47:55 PM PST by mbrfl

Boy howdy, this article by The Associated Press is very telling.

First, it’s worth remembering that in the fine print of the USMCA deal, Mexico and Canada must comply with North American parts origination for anything they want to manufacture for sale into the United States. Meaning, all trade manufacturers must either create their component parts domestically, or purchase them from the U.S, Mexico and Canada. It’s the core point of the USMCA trade agreement.

Secondly, in an aspect exclusive to the U.S. part of the deal that President Trump and USTR Lighthizer insisted upon, if either Canada or Mexico are deemed to be non-compliant with the agreement, the USA can cancel/override any trade agreement Mexico or Canada have with another nation. It’s a heavy accountability hammer securing the gate into the massive USA market.

In an AP report today, Mexico is scrambling to find local or North American sources of parts and components, because President Trump is set to come into office and look at USMCA compliance. Apparently, Mexico has been using excessive amounts of Chinese component parts for goods being sent into the USA and Canada. Now they are quickly trying to source alternatives.

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1 posted on 11/23/2024 3:47:55 PM PST by mbrfl

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