Mexico was the first country in Latin America to sign a partnership agreement with the European Union
Mexico was the first country in Latin America to sign a partnership agreement with the European Union
1. Mexico and the EU
Mexico was the first country in Latin America to sign a partnership agreement with the European Union (1997). The “EU-Mexico Economic Partnership agreement” entered into force in 2000 and established a free trade area between the two parties.
The new agreement from 2018 covers all goods, including the agricultural sector. It will be the first EU trade agreement to include an anti-corruption chapter for both, the private and the public sectors.
In 2020, both parties concluded the last outstanding element of the negotiation of their new trade agreement and agreed on the exact scope of the reciprocal opening of public procurement market. With that agreement, they have a high level of predictability and transparency in public procurement processes. Mexico and the EU can advance to the signature and ratification of this agreement in line with their respective rules and procedures.
2. EU countries with the Free Trade Agreement with Mexico
Due to these FTAs, Mexico’s market is one of the most competitive and open in the world. They have removed several non-tariff barriers and reduced import duties on exports.
3. Top Trade partners of Mexico
Due to the huge market and proximity of the United States, Mexico is with over 62% very dependent on that market. The EU is Mexico's third biggest trading partner. Mexico is the EU's second biggest trading partner in Latin America after Brazil.
4. Mexico's exporting goods to the EU
Mexico is a member of the World Trade Organization (WTO) and has 13 free trade agreements (FTAs) that cover 50 countries, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Mexico have removed several non-tariff barriers and reduced import duties on exports which makes them of one of the most competitive and open market in the world. Accordingly, manufacturing as well as export companies are significantly increasing in this nation.
In 2018, total EU-Mexico trade in goods was around $70 billion, an increase of almost 6% compared to 2017, with EU exports growing faster than Mexican exports. For about half of exports accounts industrial goods, machinery appliances and transport equipment’s.
4. Mexico's exporting goods to the EU
Mexico is a member of the World Trade Organization (WTO) and has 13 free trade agreements (FTAs) that cover 50 countries, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Mexico have removed several non-tariff barriers and reduced import duties on exports which makes them of one of the most competitive and open market in the world. Accordingly, manufacturing as well as export companies are significantly increasing in this nation.
In 2018, total EU-Mexico trade in goods was around $70 billion, an increase of almost 6% compared to 2017, with EU exports growing faster than Mexican exports. For about half of exports accounts industrial goods, machinery appliances and transport equipment’s.
5. Mexico and the EU exports
As you can see in the table, Mexico’s producing mainly exist of automotive and aeronautic industry. However there is also a significant increase in the electronic and engineering area.
A forecast says that there is a continuous increase of almost 20% by the end of 2024 in the car industry, but also mechanical engineering supposed to grow a lot.
5. Mexico and the EU exports
As you can see in the table, Mexico’s producing mainly exist of automotive and aeronautic industry. However there is also a significant increase in the electronic and engineering area.
A forecast says that there is a continuous increase of almost 20% by the end of 2024 in the car industry, but also mechanical engineering supposed to grow a lot.
6. Goal of the EU-Mexico-Trade-Agreement
Their common objectives are to
Mexico which is on the edge to move from being a 3rd world country to a 2nd world country and with its proximity to the United States, the main objectives are to remove unnecessary obstacles to European imports so that EU firms can export more and vice versa.
The EU and Mexico want the agreement to:
- open up each other's markets for goods, services and investment
- promote greater economic integration
- strengthen competitiveness
- ensure a high level of protection of intellectual property rights
- eliminate, prevent and reduce unnecessary barriers to trade
- reinforce cooperation between the EU and Mexico
- contribute to the EU's and Mexico's shared objectives on labour rights and the environment (sustainable development)
- shape global trade rules in line with our high standards and shared values of democracy and the rule of law.
- Smaller exporters are disproportionately affected even by smaller barriers because they do not have the time or resources needed to overcome them. That is why the EU wants to have a dedicated chapter for them in the agreement.
- make it easier for exporters to find out which Mexican rules apply to their product
- make Mexican regulations more transparent
- lower costs through removal of non-tariff barriers
- simplify Mexican customs procedures
- create an opportunity to strengthen existing joint projects
- find new ways and programmes to help smaller firms increase exports.
- simpler rules of origin requirements
- Smaller exporters are disproportionately affected even by smaller barriers because they do not have the time or resources needed to overcome them. That is why the EU wants to have a dedicated chapter for them in the agreement.
7. EU Standards
Another benefit of the agreement is that the standards have to apply to the EU rules;
technical standards for products
consumer safety
environmental protection
animal and plant health
food safety and genetically modified organisms (GMOs).
Thanks to the talks, the EU and Mexico are working more closely with each other in several international standard-setting bodies in areas such as:
- pharmaceuticals
- chemicals
- the International Electrical Commission and
- the International Electrical Commission and
- the Codex Alimentarius – the food standards set by the United Nations Food and Agriculture Organization and the World Health Organization
by VOCSO
