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Trump administration downplays Mexican concerns about key piece of USMCA trade deal

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United States Trade Representative Robert Lighthizer speaks during a meeting with Mexican President Andres Manuel Lopez Obrador (out of frame) and Canadian Vice-Prime Minister Chrystia Freeland (out of frame) in Mexico City on December 10, 2019.

Rodrigo Arangua | AFP | Getty Images

The Trump administration on Monday downplayed a Mexican concern about a key piece of the North American trade deal the House aims to approve this week.

U.S. Trade Representative Robert Lighthizer said language in the United States-Mexico-Canada Agreement, which the three countries signed last week, does not call for American “labor inspectors” in Mexico. The Mexican government has expressed fears that the “attaches” called for in the agreement would effectively serve as inspectors, which it pushed to keep out of the trade pact.

“The Administration included language in the USMCA implementing legislation authorizing up to five attaches from the Department of Labor to work with their Mexican counterparts, workers, and civil society groups on implementation of the Mexican labor reform, including by providing technical assistance and disbursing capacity building funds, and provide assistance to the new U.S. government interagency labor committee,” Lighthizer wrote in a letter to Mexican Deputy Foreign Minister Jesus Seade dated Monday.

“These personnel will not be ‘labor inspectors’ and will abide by all relevant Mexican laws,” the agency continued.

The White House aims to ease concerns during a pivotal period for the trade agreement — one of President Donald Trump’s top economic and political priorities. The administration won support for USMCA from skeptical House Democratic leaders after including tougher labor enforcement tools in the deal, among other provisions.

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The administration likely would not have enough time to change the language before a House vote this week.

On Sunday, Seade said Mexico will “NEVER accept any measure that would see inspectors disguised for a simple reason: Mexican law prohibits it,” according to Reuters. Then earlier Monday, Mexican Foreign Minister Marcelo Ebrard said the disagreement over inspections would not jeopardize the agreement, because Mexico can decide whether to accept the attaches, the wire service reported.

Speaking Monday from Washington, Seade appeared to take a more conciliatory tone. He said the Mexican government is satisfied the panelists are not the type of inspectors it had opposed. Seade added that Mexico will choose the panelists in the U.S.

Mexico objected to the prospect of U.S. labor inspectors as the Trump administration revised the agreement to win Democratic support.

Leaders in the Democratic-held House hope to ratify USMCA by the end of the week. The Senate would then take up the agreement next year.

Mexico and Canada need to approve the trade agreement as well.

— CNBC’s Stephanie Dhue contributed to this report

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