The USMCA trade agreement, now in its fifth year of existence and up for renegotiation next year, is looking increasingly frail.
This is a story we have been tracking fairly closely over the past couple of years, and unfortunately, as things currently stand, it doesn’t look like it’s going to have a happy ending — unless, of course, you’re a Big Ag exec. Mexico has purportedly lost the dispute settlement panel brought by the US and Canada over its ban on imports of genetically modified corn for direct human consumption. That’s according to unnamed sources briefed on the ruling in a preliminary official report that has already been released to interested parties.
Those parties appear to include Mexico’s Economy Minister Marcel Ebrard. Speaking at a conference on the future of North America on Wednesday, Ebrard acknowledged that it could lose the corn dispute against its USMCA partners: “Now they have already given us the preliminary results of the [case], the process is not yet finished,… but maybe they will beat us.”
In other words, not only will the US government have sued Mexico for not buying their high-risk GMO products, citing basic precautionary reasons related to health and the environment, it also appears to have won the case.
Stiff Penalties
After a year of presentations and deliberations, the three arbitrators chosen to oversee the case are expected to issue a ruling by the end of this month. If that ruling goes against Mexico, as the sources cited by publications like El Economista claim, the government will have to reverse its 2023 decree banning GM corn for human consumption — or face stiff penalties, including possibly sanctions.
Mexico’s government may opt for the latter, says Timothy A Wise, author of Eating Tomorrow and senior adviser at the Institute of Agriculture and Trade Policy:
“If Mexico loses, it could accept the penalty but keep the policy. AMLO [President Andrés Manuel López Obrador] has also indicated that he would seek hearings in other international venues. What I think is safe to say is that Mexico has no intention of allowing GM corn into its tortillas.”
Whether that is true or not, time will soon tell. Early indications suggest that AMLO’s presidential successor, Claudia Sheinbaum, is not for budging. Two months before winning the presidential election in June, Sheinbaum signed an accord with Mexico’s peasant organisations to uphold the ban on transgenic maize in food and replace glyphosate with safer alternatives.
On the day of her inauguration, she learnt that US congressmen had just sent a letter to the US Trade Representative exhorting her to pressure Sheinbaum to back down on the GM corn ban. Uncowed, Sheinbaum used her inaugural speech to reiterate Mexico’s rejection of genetically modified corn. Yesterday, as rumours swirled that Mexico had lost the dispute, Sheinbaum announced that her government would in the coming days present a plan to enshrine the protection of the country’s non-genetically modified white corn in the constitution.
We have to differentiate between white corn and yellow corn. Mexico is self-sufficient in white corn and we have an obligation to ensure that the white corn cultivated in Mexico is not genetically-modified. This will be in the constitution as this is the best defence we have for biodiversity as well as for our health.
The potential health risks posed by GM corn — painstakingly documented by the hundreds of peer-reviewed studies cited in Mexico’s defence, including indications of serious kidney and liver ailments in adolescents after even low-level exposures to glyphosate — are magnified in Mexico, where the national diet revolves around minimally processed white corn, in particular tortillas. Cornmeal provides more than 60% of the average Mexican’s daily calories and protein, which is around 10 times the US average, putting Mexicans at 10 times the risk.
“The Emperor Has No Science”
In a recent article for TruthDig, Wise explains why a ruling against Mexico would make very little sense. A brief three-point summary:
- Mexico’s restrictions have not reduced U.S. corn exports in any meaningful way. On the contrary, Mexican imports of US corn have actually surged to record levels during the year-and-a-half since the presidential decree, largely as a result of the country’s drought last year. And even as Mexico gradually phases out its consumption of GM corn for other purposes, mainly as animal feed, US farmers will always have the option of producing non-GM white corn and securing their Mexican markets for the long haul.
- In its complaint, the US government alleged that Mexico’s approach to biotechnology is not based on science, and challenged the Mexican government to prove otherwise. Which it proceeded to do in emphatic fashion, “providing mountains of evidence from peer-reviewed literature that showed ample cause for concern about the risks of consuming GM corn and the residues of the herbicide glyphosate — most commonly known as Roundup — that often come with it.”
- For its part, Mexico has challenged the US to show that its GM corn is safe to eat in the quantities and forms that Mexicans consume it, and has seemingly received no response. “As a Reuters headline put it in March: ‘Mexico waiting on US proof that GM corn is safe for its people.’ No such proof was forthcoming as the U.S. government flailed in its attempts to counter the hundreds of studies Mexico identified that showed risk. A U.S. filing claiming to rebut the evidence did no such thing.”
As Wise puts it, “the emperor has no science.” But that won’t prevent it from prevailing. The practice of science is a pale shadow of what it used to be, as KLG’s excellent essays keep reminding us.
If the Mexican government loses this case and is forced to repeal the 2023 decree banning GMO corn, it will have effectively lost the ability to set its own food policies. As Alexander Zaitchik notes in an excellent backgrounder provided by The Nation, this would represent a brutal loss of national sovereignty and food security that could have reverberations far beyond North America:
Do nations have the right to determine their own food policies? Can they make laws to safeguard domestic agriculture, public health, the environment, and the genetic integrity of the national diet?
If sovereignty means anything, the answer to these questions is yes. Defending food supplies is an ancient cornerstone of the social contract, one enshrined in 21st-century trade pacts, including the US-Mexico-Canada Agreement (USMCA), the successor to NAFTA. In December 2023, Mexican President Andrés Manuel López Obrador invoked this right when he banned genetically modified corn for human consumption and announced a plan to phase out the use of glyphosate, GM corn’s signature herbicide, which the World Health Organization calls “probably carcinogenic to humans.” The measure, said López Obrador, was necessary to guarantee Mexicans’ “rights to health and a healthy environment, native corn, [and] ensure a nutritious, sufficient, and quality diet.”…
[W]hatever [the dispute panel’s] judgement, the US-Mexican dispute has put a needed spotlight on mounting global concern about the consolidation of a global food system dominated by a handful of biotech and chemical firms. Mexico’s challenge has also bolstered its standing as hemispheric leader of an agroecology movement gaining momentum across the global south.
“If the biotech companies defeat maize in its center of origin, it will embolden them to do the same in other centers of origin,” said Tania Monserrat Téllez, an organizer with Sin Maiz, No Hay Pais (Without Corn, There Is No Nation), a coalition of groups in Mexico supporting the ban. “We are challenging an entire model of production that threatens not just Mexico, but the world.”
That model revolves around the mass production of lab-designed GM seeds for crops that will end up laced with toxic herbicides like glyphosate. The accompanying business model involves the ruthless enforcement of rigid intellectual copyright and patent laws. It is a business model that has been vigorously opposed by campesino groups throughout Latin America, which, together with North America, is one of the two most important regions of the world for GM crop cultivation.
In 2013, for example, Colombia’s government passed into law a resolution that sought to force the nation’s farmers to exclusively use certified seeds – patented by the world’s largest agribusiness companies. When Colombian farmers realised that sharing or giving away seeds – a practice that dates back millennia – was now a crime, they mounted a collective resistance struggle that brought large swathes of the country’s rural heartland to a standstill, culminating in direct, bloody clashes with government and paramilitary forces.
Eventually, Colombia’s Supreme Court declared the law unconstitutional, not least of all because indigenous communities had not been consulted before its implementation. As Sheinbaum explained during her press conference, the GMO business model is one based primarily on forced dependence:
“Genetically modified organisms have an additional problem which is that the farmer always depends on the seeds. When he sows hybrid corn that is modified in the laboratory… he buys the seed and depends on the seed to be able to continue growing corn. At the same time, the genetic diversity of Mexico’s corn that resulted from our peoples’ toil and that has remained more or less in tact until [now] will be lost.”
That loss would be a tragedy not only for Mexico but for the world as a whole, as argues a 2018 article in Scientific American:
Commercial corn farmers in Mexico planted around 3.2 million acres during the rainy season; the rest—more than 11.5 million acres—was planted by campesinos, the researchers reported in August in Proceedings of the Royal Society. Using previous estimates, [the research team was] able to calculate that in 2010 alone family farmers in Mexico grew approximately 138 billion genetically different maize plants. The domestication of native maize across a wide range of temperatures, altitudes and slopes has allowed rare mutations to take hold that would otherwise disappear, Bellon notes. “Campesinos are generating an evolutionary service that is essential for them, for the country and, given the global importance of maize, for the world,” he says.
In a rational world, Mexico would be allowed — indeed, encouraged — to safeguard this treasure trove of biodiversity against GMO contamination. But alas, this is not a rational world.
That said, it’s not all doom and gloom just yet. There are at least two silver linings to this story:
- As Wise muses, Mexico’s public filings in the GM corn case, which are now a matter of public record, “may actually reopen the debate in the US and elsewhere over the safety of GM crops and their associated chemicals.” Also, as AMLO has said, Mexico will take the case to other international fora. For its part, the Sheinbaum government has announced plans to boost local production of corn and beans, Mexico’s two main staples, while escalating its war on obesity. Whether it can actually deliver on those objectives, only time will tell.
- Bayer, the owner of glyphosate (after buying Monsanto in 2018 in arguably the worst merger of modern corporate history), is in dire financial straits. As the FT reported earlier this year, “its breakup looks inevitable.” Its shares continue to slide, having already lost roughly 80% of their value since 2018, and are now worth just 20 billion euros, significantly below its net debt (39 billion euros). In its latest earnings statement, the much-diminished German chemicals giant reported a net loss of 4.18 billion euros in the third quarter. Worldwide sales of glyphosate are sinking and one of the worst performing regions for its agricultural market is Latin America. Just what the German economy needed…
OUCH! Following the profit warning, #Bayer's market cap fell to €20bn, even further below net debt. pic.twitter.com/rYvHlGiSAT
— Holger Zschaepitz (@Schuldensuehner) November 13, 2024
With Friends Like These…
The US’ corn dispute with Mexico is one of a host of trade disputes that have been brought against the Mexican government by its USMCA partners since the signing of the trade deal in 2018. In 2023, Mexico had received the most investment arbitration claims under investment protection treaties worldwide, according to the Transnational Institute.
It is a trend that shows no sign of abating. In coming months, the Sheinbaum government is planning to pass over a dozen constitutional reforms, on (among other things) mining, energy, housing, agriculture and labour rights, etc, that are also likely to ruffle feathers in the C-suites of US and Canadian companies.
The USMCA trade agreement, now in its fifth year of existence and up for renegotiation next year, is looking increasingly frail. Trump is threatening to impose ratcheting tariffs of up to 100% on Mexican goods if the Sheinbaum government doesn’t close its border with the US. Of course, this could be pure electoral bluster coming from Trump. But if he does follow through on these threats, it would seriously undermine the very trade deal he himself helped broker as well as invite tit-for-tat tariffs from Mexico’s government.
Meanwhile, in Canada the premier of Ontario, Doug Ford, has called for the removal of Mexico altogether from the trade agreement due to its growing trade and diplomatic ties with China (a topic we covered just a couple of months ago).
“Since signing on to the United States-Mexico-Canada Agreement, Mexico has allowed itself to become a backdoor for Chinese cars, auto parts and other products into Canadian and American markets, putting Canadian and American workers’ livelihoods at risk while undermining our communities.”
The Canadian government is also up in arms about the Sheinbaum government’s plans to radically rewrite Mexico’s mining laws. For over three decades, Mexico has been a veritable paradise for global mining conglomerates, many of them based in Canada, serving up some of the laxest regulations in Latin America. That is now changing. The proposed reforms include a near-total ban on open-pit mining and much stricter restrictions on the use of water in areas with low availability.
Ford’s proposal to eject Mexico from USMCA has an ironic twist given that it was Mexico’s AMLO government that allegedly intervened to helped seal Canada’s membership of the USMCA. By late 2018, relations between Trump and Trudeau had soured to the point where Trump was threatening to leave Ottawa out of the trade deal altogether after already signing a preliminary agreement with Mexico. But AMLO apparently said to Trump: “No, we are going to have Canada participate as well.” And President Trump acceded.
Now, Canada’s Deputy Prime Minister, Economy Minister and WEF Trustee Chrystia Freeland is paying Mexico’s government back by echoing US concerns that Mexico’s trade policy is not in line with its US allies on China. Speaking to reporters in Ottawa this week, Freeland claimed to have heard these concerns from people expected to serve alongside US President-elect Donald Trump, as well as current Biden administration officials and other US business leaders.
Another irony in all this is that as tensions have risen between the US and Mexico, business has never been better. Due to changing global trade patterns and nearshoring strategies, Mexico has become the US’ biggest trading partner, as the volume of goods the US buys from its southern neighbour has surged past those of China and Canada. Exports to the US from Mexico have increased 20 percent-plus annually between 2020 and mid-2024 while exports from China have steadily fallen, according to data cited by CNBC.
But while the Mexican economy may have benefited enormously from rising trade with the US over the past five years, the price tag is growing rapidly.
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Thank you for this thorough, deep dive report. Excellent.
Meanwhile, in Canada the governor of Ontario, Doug Ford, has called for the removal of Mexico altogether from the trade agreement due to its growing trade and diplomatic ties with China
My awakening to what Canada really is, a member of the five eyes that dutifully tows the line for the “globalist” began with the Trucker protest during the high mark of the CV19 era, it widened as I watched a Nazi get a standing ovation from their parliament and their recent refusal to divulge the names of 900 Nazis that sought haven in Canada after WWII, and their stand on Venezuela, to name but a few recent events. This article cements my loathing to this an erstwhile fathom belief that resided in my mind…sad, because I used go visit family in Vancouver, BC and came to love the place – at least as it existed many years ago.
Canuckistan sucked up to Britain when it was their colony. When Canuckistan became a United States of Atrocity (USA) vassal state, it commenced sucking up to the them.
Hey! If Mexico gets removed from the trade agreement due to whatever is making Ford so upset, does that mean that Mexico gets removed from jurisdictional enforceablity of whatever judgements that trade agreement forces Mexico to accept when cases are brought against Mexico to the relevant Korporate Kangaroo Kourts?
Because if it does, then being thrown out of the agreement might be form of accidental protectionism for Mexican sovereignty just as the anti-Russia sanctions turned out to be a form of accidental protectionism for the Russian economy.
Perhaps Mexico should unilaterally withdraw from the New NAFTA or whatever it is called. That way, Mexico can ban any corn it wants on any day it feels like.
I agree with everything you write, with one big exception: Your admiration for the so-called trucker protest, in which the participants were largely thuggish idiots brandishing Nazi and confederate flags, leaning on air-horns 24/7, harassing and threatening health care workers, assaulting mask wearers, starting midnight fires in high-rise apartment building lobbies in response to the largely working class, downtown Ottawa residents defiance of the “protesters” determination to prevent anyone from sleeping in a weeks-long, living hell — and their bat-s**t crazy ultra right wing, political agenda.
Our extended family, on a balance of probabilities, chose to be vaccinated, but respected the views of those who opted not to be. But we whole-heartedly embraced masking and barred entry into our designated-essential premises to any who refused to mask up. We supported, and came to the aid of Asians, including Asian family members, who were subjected to racist physical and verbal assaults.
The million-plus population of Metro Vancouver is just under 50% East Asian, as is our family, and as is an even higher percentage of our healthcare workers. While isolated racist and anti-masking attacks and intimidation were an almost daily occurrence, they were not tolerated and were responded to — with force, when warranted.
On this side of the border, we still tend to give weight to the collective good over individual freedom when push comes to shove, and our pandemic mortality rates — and our antipathy to the “trucker” protest reflect that.
should mexico not prevail, i look forward to seeing the mental gymnastics required for such a finding. monsanto/bayer keeps losing cases and the science keeps demonstrating that this technology doesn’t support mammalian health. add to that the sovereignty issues Mexico faces I don’t know how they can’t leave the pact. US farmers can also move to non GMO varieties and keep their customers happy. What weird world do we live in?
One out of a thousand US farmers already grow non GMO varieties of corn. Perhaps the numbers might not improve beyond that. But those one out of a thousand have and will have a market for their non GMO corn.
And they are a big enough seed-market that corn seed companies are growing seed to sell to FrankenFree CleanGenes farmers. I can’t remember their names offhand, but they advertise in Acres USA and elsewhere. I am talking about small-but-real-industrial quantities of non GMO corn seed, not small amounts for home growers, hobby farmers, artisanal farmers, etc. I can easily remember a few of those tiny-company names. Shumway Seeds, Sand Hill Preservation Seeds, etc. etc. etc.
I find it interesting that the USMCA agreement is up for renegotiation next year. Mexico has been the loop-hole for avoiding President Trump’s prior tariff increases. Could it be that AMLO & Trump will find common ground to either sink USMCA or plug holes they both abhor?
Is AMLO negotiating on behalf of President Sheinbaum? That would be nice.
AMLO has “passed the torch” of the Mexican presidency to Claudia Scheinbaum – just sayin ;^). While he probably plays an advisory role to her administration, I think it highly unlikely that he would seek common ground with our president-elect over a ‘bone of contention’ such as this.
“US congressmen had just sent a letter to the US Trade Representative exhorting her to pressure Sheinbaum to back down on the GM corn ban”
Love to know the congressmen who signed that letter – their connections – their contributors – and publicly tar and feather them!!!
TomD
I believe this is it, sent right before her inauguration.
Ron Estes (R-KS), Jim Costa (D-CA), Greg Stanton (D-AZ), Jodey Arrington (R-TX), Beth Van Duyne (R-TX), Mike Carey (R-OH), Michelle Steel (R-CA), Claudia Tenney (R-NY), and David Schweikert (R-AZ)
https://adriansmith.house.gov/media/press-releases/smith-colleagues-send-letter-ustr-mexicos-usmca-obligations
Lots to chew on here. If that treaty is up for negotiations next year, then all countries will want changes made but I suspect that it will be the US and Canada wanting changes that will be detrimental to Mexico. Trump may be the wild card here and is of course unpredictable. It may be by then that Trump will be in a tariff war with China and will demand that Mexico halt all trade with China in those renegotiations or else be kicked out. Mexico would be better served from not continuing this trade death pact and opening up their doors to all trade partners, especially China. Or maybe just letting the US and Canada eject them from this treaty – if they are up for it.
Indeed, particularly if RFK is confirmed, not sure if Salatin needs approval.
I see Mexico holding the ace card of proposing to join BRICS if it doesn’t get some slack (or leaves). China could replace a lot of lost US trade with Mexico especially if China is in a trade war with the US.
China exported $90 billion to Mexico, Mexico exported 360 billion to the US. The Macquilladores will be due to political pressure outside (IMHO) Trump trade policies, said to account for 45% of exports (Wikipedia). Seems within reasonable levels for trade growth, aka what has happened with Russia and India for China Substitution.
Salatin? Interesting. I think an “advisor to the” does not need confirmation. Especially if it is a non-paid position.
If Salatin gets an “advisor to the” post, one hopes that he suggests to all relevant persons that Gabe Brown and Gary Zimmer also get “advisor to the” posts.
Get Joel Salatin and RFK Jr. on the carpet, STAT! Go git ’em, boys! Sick ’em!
Will that rubber meet the road?
It will be fun to see if Big Ag pushes this hard and fast, as did Gaetz in his speedy resignation.
An overton wndow of sorts is shifting closed, and one better act fast!
It is a trend that shows no sign of abating. In coming months, the Sheinbaum government is planning to pass over a dozen constitutional reforms, on (among other things) mining, energy, housing, agriculture and labour rights, etc, that are also likely to ruffle feathers in the C-suites of US and Canadian companies.
If I were Mexico, I would start stocking up on drones and missiles. /s
Mexico will be the most hard hit by tariffs so nothing to lose by fighting back
‘Blowback’ might hit us harder, if the sanctions we applied on Russia and the “Axis of Evil” in West Asia and/or the Middle East are any indication. Again, just sayin’.
Pre-NAFTA, I worked in a medical clinic (translator) in a small, mountain village in Sinaloa. Mexico, for several years. The local farmers worked their fields and their (slash and burn) hillsides diligently to raise enough corn and beans for their families to survive. The surplus, they sold to buy necessities, such as farming implements, salt, sugar, and some canned goods (the households always had small vegetable gardens with chilis and tomatoes). It was a hard life, but sustainable, and allowed them to raise and educate their children.
NAFTA destroyed that life style as well as the medium-sized farms which produced the bulk of Mexico’s corn needs. By allowing the import of Midwestern, subsidized American corn, all these small and medium farmers were driven out of business. Bankrupt, corn farmers took their families and fled North, ‘al otro lado’, to work in American fields, construction sites, restaurants, etc. This migration was not easy because prior to NAFTA’s enactment, Clinton militarized the border because he knew or intuited what would happen. But thousands and thousands of Mexicans came and settled in the US, documented and undocumented. They are still here because they have nowhere to go back to anymore.
Neoliberal efficiency dictated this NAFTA policy, and we should learn a big lesson that ‘efficiency’ is a poor metric when dealing with people’s lives.
compa,
gracias pa tu palabras de experiencia y sabiduria tambien. hablaste la pura neta, una neta que las que comentan aqui no entienden, la mayoría nos creen ilegales. somos indigenos, como podimos a ser ilegal en nos propio tierra, neta?
pues te agradesco, compa
One big goal of NAFTA was to achieve this social destruction of Mexican society deliberately on purpose, precisely in order to drive tens of millions of Mexicans off the land and into the belt of maquiladoras envisioned as stretching from the Pacific and Gulf of Cortez to the Gulf of Mexico on Mexico’s side of the border. Of course, by bringing China into the WTO and by granting MFN status for China, Clinton caused most of those maquiladoras to be built in China instead of in Mexico.
Whoopsie . . . .
Still and all, Clinton did achieve getting all those maquiladoras built, in order to exterminate millions of union and union-adjacent jobs in America, which was Clinton’s other Prime Directive and Driving Imperative.
Someone has suggested referring to all the Mexican economic exiles living in America as ” naftastinians”. Maybe that is a word whose time has come. Naftastinians. Think about it.
It’s really a bad look for the United States to be bullying Mexico like this. Is there no shame?
We’re a collapsing fascist nation (i.e., state corporatism) in thrall to oligarchs. What kind of look should we have?
Apologetic, remorseful, humble, and extremely guilty!
Mexico should start planning to join BRICS now to avoid an onslaught of U.S. arm twisting to sign unfavorable trade deals. Maybe while they’re at it, they can test out that ‘international rules based order,’ by entering into a ‘defensive alliance’ with Russia and China.
That would actually be hilarious. Serves us right for focusing on everything but our own country and local issues for the last 20 years.
But really, did we seriously expect that no other country would argue against these extra judicial, extra constitutional, asovereign, policies that benefit very few people? Was it seriously the plan that we would enact a collection of TPPs and NAFTAs and USMCAs so that no nation agreeing to any part of them would be able to make any unilateral decisions on their own for matters affecting their country? We were going to be led by some ultra elite group of bureaucrats with no national affiliation? Really?
If that was the plan these people deserve to be rhetorically curb stomped until their policy positions never leave their cushy offices again.
Serves ” us” right? Which “us” do you have in mind?
Surely not the “us” who objected to NAFTA, WTO, MFN for China, etc. and who were all over-ruled?
Surely not the “us” who voted for Trump in 2016 in order to get revenge for NAFTA, WTO, MFN for China, etc. and also to prevent TPP and TTIP?
Maybe the American farmers who already grow clean healthy corn will not share the bad look with those farmers who grow filthy toxic GMO coarn and then support government cramming their filthy toxic GMO coarn down Mexico’s throat ( as well as down America’s own throat, by the way).
Unfortunately everyone in the US will be caught in the blast radius of any of those effects. It’s not like the people acting against the US now can aim their sights at only the people in the MIC. They’ll have all the rights to hit us with sanctions or whatever else we’ve spread in the world for the last several decades.
So it’s us.
I think you are confusing the moral with the operational. Yes, us will be caught in the blast radius.
No, those of “us” who voted/worked against NAFTA, etc. as best we could do not “deserve” to be caught there.
Perhaps “us” who can expect to be caught in the blast-radius can begin ahead of time gaming out what all the blast-radius effects will be, and work to make us-selves , us’s communities and eachother as resilient, tolerant, resistant, etc. as possible to those blast radius effects.
And if “us” can achieve all that pre-blast-radius pre-hardening of us’s lives and communities, we must not permit any of us’s knowledge and preparations to even become known to “them” who supported and caused NAFTA, Free Trade, etc.
” Them” have no right to exist. “Them” do not deserve to survive. Anyone of “us” who helps “them” to protect “them”selves against the blast radius effects which them will bring down upon us as well as themselves is a traitor against all of us collectively and every single one of us individually.
Help the helpers.
Hurt the hurters.
Minor quibble: Ontario does not have a governor.
Doug Ford is the Premier of Ontario (for our sins).
Fixed! Thanks for the heads-up, jrkrideau.