Europe and Mexico update trade pact, in signal to U.S.

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April 21, 2018 11:58 PM

WASHINGTON — The European Union and Mexico on Saturday announced a major update to their free trade pact signed nearly two decades ago, a development that will allow almost all goods.

The deal, which has yet to be formally signed, is expected to increase trade in dairy, pork, services, digital goods and medicines between the economies.

It will also give Mexico greater access to an advanced consumer market, as negotiations with the Trump administration over the modernization of the North American Free Trade Agreement still appear to be on uncertain ground.

And it sends a message to President Donald Trump that some of the United States' closest trading partners are moving ahead with deals of their own — potentially leaving U.S. exporters on the losing end in foreign markets.

In its announcement, Mexico said the agreement would help modernize its existing commercial relationship.

Jean-Claude Juncker, president of the European Commission, said in a statement that “trade can and should be a win-win process, and today’s agreement shows just that.” He added, “With this agreement, Mexico joins Canada, Japan and Singapore in the growing list of partners willing to work with the EU in defending open, fair and rules-based trade.”

The European Union and Mexico said they had reached an agreement in principle on the most important elements of the agreement, with some technical details yet to be resolved. They are aiming to finalize it by year’s end, after which it must be ratified by the European Parliament and Mexican senate.

The original trade pact, signed in 1997, was relatively narrow, mainly eliminating tariffs on cars and machinery. The deal came into force in 2000 and was the first free trade pact between Europe and a Latin American country.

Since then, the European Union has added 13 members. The revised deal adds in a variety of new rules governing agricultural goods, telecommunications, digital trade, intellectual property, climate change, anti-corruption measures, finance and energy.

The European Union now has close ties with both of America’s NAFTA partners, after a new pact with Canada went into force in September.

This article originally appeared in The New York Times.

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