NAFTA Monitor
Tuesday, February 15, 1994
Volume 1, Number 8
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Headlines:
DALLAS MAY HOST NAFTA LABOR COMMISSION
CONGRESS REPS WHO VOTED 'NO' ON NAFTA FACE TOUGH CAMPAIGN
NAFTA PARITY WILL REQUIRE ECONOMIC CHANGES IN HEMISPHERE
MARKET SECTOR DEVELOPS AROUND NAFTA BUSINESS EXPANSION
UNINSURED MEXICAN TRUCKERS PROHIBITED FROM ENTERING U.S.
RESOURCES
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DALLAS MAY HOST NAFTA LABOR COMMISSION
The Clinton administration is expected to announce that Dallas will house
NAFTA's "labor secretariat," an agency established under the free trade accord
to monitor labor market conditions in the United States, Canada and Mexico. "We
haven't been notified officially that the NAFTA secretariat is going to be in
Dallas, although it is looking quite good," said Mayor Steve Bartlett. "I'm
very optimistic," said Representative John Bryant (D-Texas) who has lobbied
trade officials to place the office in Dallas.
The DALLAS MORNING NEWS quoted sources in Washington and Texas as saying the
Clinton administration would make the announcement soon.
Source: "Dallas Likely to be Site of Major NAFTA Office," UPI, February 12,
1994.
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CONGRESS REPS WHO VOTED 'NO' ON NAFTA FACE TOUGH CAMPAIGN
The TEXAS OBSERVER noted recently that Representatives Gene Green (D-Texas) and
Craig Washington (D-Texas) are being targeted by the HOUSTON CHRONICLE for
failing the "NAFTA test." The CHRONICLE reportedly endorsed Green's primary
opponent, Ben Reyes, because Green followed the demands of labor unions and
voted against NAFTA.
However, Green's vote won him strong support from the AFL-CIO. In a recent
report, the AFL-CIO cited Green as one of five Congressional representatives who
voted 100 percent in agreement with labor on 12 issues, including NAFTA.
Sources: "NAFTA Retribution," TEXAS OBSERVER, February 11, 1994; "Labor
Scorecard," TEXAS OBSERVER, February 11, 1994.
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NAFTA PARITY WILL REQUIRE ECONOMIC CHANGES IN HEMISPHERE
The direction of Latin American and Caribbean economies will be guided largely
by whether they receive parity with NAFTA, according to an article in GLOBAL
PRODUCTION & TRANSPORTATION. Accession to the North American market is
"foremost on the minds of private and public sector players in the region,"
writes Kathleen Dunnewald.
The U.S. Congress is expected to consider a bill, sponsored by Representative
Sam Gibbons ( D- Florida), giving members of the Caribbean Basin Initiative
(CBI) parity with NAFTA for three years. CBI members, who have received
preferential access to some U.S. markets over the past nine years, would be
required to negotiate their own free trade agreements with the U.S. or accede to
NAFTA during the three-year period.
"Parity is going to be a two-way street," said Andrew Postal, president of a New
York City-based apparel company that is active in the Caribbean Basin "Because
of the politics in this, you can expect demands coming from Washington that are
going to establish a great many pre-conditions before the benefits of NAFTA are
conferred on the region."
Cameron Clark, president of a Connecticut-based consulting firm, said he expects
qualitative factors, such as workers' rights, health, safety, welfare, the
environment and intellectual property rights to be the keys to expanding NAFTA
to CBI nations.
Clark also noted that the biggest factor currently facing Latin American
economic growth is private sector management and production. "The private
sector must become more competitive," Clark said. "The ability of the Caribbean
Basin to benefit from NAFTA will depend upon improving our production and
improving our efficiency."
The Clinton administration is considering extending parity to CBI members, but
has also been pushing for the creation of a Western Hemisphere free trade zone
in 10 to 15 years. Under the plan, Latin American countries, beginning with
Chile, would be required to join NAFTA. Clinton is expected to unveil the plan
during a meeting of 34 of the hemisphere's leaders scheduled for this spring.
Sources: Kathleen Dunnewald, "Plotting NAFTA Parity," GLOBAL PRODUCTION &
TRANSPORTATION, January/February, 1994; Canute James, "U.S. Seeks to Ease Impact
of NAFTA on the Caribbean," JOURNAL OF COMMERCE, January 26, 1994; Steven
Greenhouse, "U.S. Plans Expanded Trade Zone," NEW YORK TIMES, February 4, 1994.
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MARKET SECTOR DEVELOPS AROUND NAFTA BUSINESS EXPANSION
A number of marketing companies located along the U.S.-Mexico border have begun
selling services to U.S. and Canadian firms looking to relocate to Mexico. The
North American Plant Relocation (NAPR), for example, offers a "1-800-5-RELOCATE"
number companies can call for information on joint ventures, subcontracting,
shelters, franchising, consulting and distribution. NAPR states in its ad,
"Relocation to Mexico Made Easier," that it will "acquire permits, documentation
and set up the corporation necessary for your operation in as little as 45
days."
Another company called TraTec offers a complete "factory Start-Up" package for
large and small manufacturers looking to open facilities in Mexico. "We lease
the Mexican employees to you, train and educate your transferred key production
management staff in local Mexican traditions, decorum, and requirements to
succeed in the Mexican environment," states the TraTec ad. Washington
Pharmaceuticals, Safety Storage, Schlage Lock, I.T.T., Mennen and Davis & Geck
are listed as clients.
Sources: "Important NAFTA Update," TRATEC AD, GLOBAL PRODUCTION &
TRANSPORTATION, January/ February, 1994; "Relocation to Mexico Made Easier,"
NAPR AD, GLOBAL PRODUCTION & TRANSPORTATION, January/ February, 1994.
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UNINSURED MEXICAN TRUCKERS PROHIBITED FROM ENTERING U.S.
Texas state police have recently stepped up efforts to stop Mexican truckers
with unauthorized insurance from driving in the United States. Texas
authorities estimate that random spot-checks on Mexican truck drivers have cut
in half the number of inadequately insured trucks. Before the checks began,
authorities reported that an estimated 15 percent, or 3,600 of the 24,000 trucks
that crossed in to Texas each day carried coverage from unauthorized, offshore
insurers. The percentage of uninsured trucks now entering Texas has dropped to
7.5 percent or 1,800 per day, said Mary Sherman, an investigator for the Texas
Insurance Department.
Mexican truckers are currently only able to travel 30 miles past border
crossings into the U.S. But in 1995, as negotiated under NAFTA, Mexican motor
carriers will have full access to all border states and in 2000 will be able to
trade all across the United States.
The American Automobile Association (AAA) is concerned that U.S. truck size and
weight, licensing and safety standards will be lowered to meet those
requirements in Mexico and Canada. AAA sent a letter to U.S. Trade
Representative Mickey Kantor shortly after the NAFTA vote, urging him to
establish safeguards that will prevent the weakening of U.S. truck standards.
Sources: Brigitte Maxey, "Texas Gets Tough on Mexican Truckers," JOURNAL OF
COMMERCE, January 25, 1994; Brian Nicol, "Trucks, Trade and AAA," HOME & AWAY.
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RESOURCES
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1. "51 Alternatives to NAFTA," ECONOMIC JUSTICE REPORT, 1V/1, April, 1993. 12
pages. $2.00. 11 Madison Ave., Toronto, Ontario, Canada M5R 2S2.
This report presents a wide range of policy alternatives to promote sustainable
development should the Canadian and Mexican governments withdraw from NAFTA.
2. "Intellectual Property Rights in NAFTA," ECONOMIC JUSTICE REPORT, 1V/1,
April, 1993. 12 pages. $2.00. 11 Madison Ave., Toronto, Ontario, Canada M5R
2S2.
This study explores the implications of NAFTA's intellectual property provisions
for health care and industrial policy.
3. NAFTA Origin Expert-System Software, LIVINGSTON GROUP, February 1993.
$4,995.00. Origin Department, 405 405 The West Mall, Toronto, Ontario, Canada
M9C
5K7. Tel: (800) 387-7582. Fax: (416) 622-3890.
This software program, designed by a former member of Mexico's negotiating team,
guides the user through NAFTA's 1,200-page text to investigate new manufacturing
and export regulations and required documentation.
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