President Calderon Warns About Growing Trade Restrictions Carina Steckenleiter - MNI
go to original April 25, 2012

Mexico's President Felipe Calderon

WASHINGTON - Mexico's President Felipe Calderon warned Tuesday about growing trade restrictions, and slammed protectionist steps and expropriation while urging more free trade to boost growth.

"I do believe with full respect to other colleagues that expropriation processes are really things of the past and no one loses more in an expropriation that the country who uses it. Because what a developing economy needs is more foreign investment and not less," Calderon said in a speech.

Though he did not name the country specifically, Argentina last week announced the seizure of oil company YPF, striping the Spanish firm Repsol of its majority shares in the company. Mexico's Pemex in turn has a 9.5% stake in Repsol.

Speaking at the Chamber of Commerce, Calderon said "we need more trade, more investment and more freedom ... and that is the reason why protectionism is against what the world needs today.

"For us it is absolutely clear that one of the most important alternatives in order to recover growth in the world economy is trade," he said.

Mexico is pushing to be part of the Trans-Pacific Partnership to take advantage of links to growing Latin American and Asian economies.

In addition, "We are even planning and pushing for a free trade agreement with Brazil. Unfortunately, some pressures in the Brazilian government are moving back, pulling some restrictions on free trade which is a benefit for no one," Calderon said.

Mexico has "proved the benefits of trade with NAFTA" and for this reason now is organizing the "Pacific Alliance" with Colombia, Chile and Peru, Calderon said which he said would include an effort "to share even stock markets in our countries."

Calderon said pushing for more trade agreements and reducing tariffs from about 11% in 2006 to 4.4% in 2011 did not harm Mexican exports, but increased them.

"The sectors that experienced the biggest growth were those with the greatest reduction in general tariffs," he said, citing the auto and the transportation equipment sector. In fact, "the more protected ones are losing ground."

He also stressed the importance of strengthening the U.S.-Mexico partnership, since the U.S. is the biggest importer of Mexican goods while Mexico is their "second largest U.S. export market."

A report released by the Chamber of Commerce about the U.S-Mexico Economic Partnership said that "in 2011, U.S. exports to Mexico grew by $34 billion, the biggest dollar increase in U.S. exports to any market worldwide."

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