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MEXICO CITY (Dow Jones)--Mexico's formal request for a second
dispute panel under the North American Free Trade Agreement over a
bilateral sugar trade row with the U.S. could come about in "a
matter of hours" unless the U.S. makes a satisfactory proposal,
officials said.
Mexican Commerce Minister Herminio Blanco said in a radio
interview Tuesday that talks were continuing with the U.S. to seek a
negotiated settlement on the size of Mexico's disputed access to
U.S. duty-free sugar quotas, but indicated time was running out.
"If no satisfying solution is found then Mexico will go
ahead and request the panel, and this could be a matter of
hours," an aide to Blanco cited Blanco as saying.
"Blanco repeated that after seven years from NAFTA's start
it is the official position that Mexico now has the right to export
its total surplus (sugar) production, but the position is also to
keep working for a negotiated settlement," the aide said.
Another ministry official said "a matter of hours"
could mean anything from two hours to 48 hours, and maintained the
importance of the talks still continuing.
The fact talks were still continuing showed that proposals being
consulted with the local industries contained some interesting
aspects, the official said.
"The negotiations are still on, the talks continue, and that
we still haven't requested the panel should be taken as a sign that
some interesting issues have come up in the proposals," said
the official.
He said Mexico's Deputy Commerce Minister Luis de la Calle
remained in Washington while consultations were going on.
U.S. and Mexican officials on Tuesday consulted with their
domestic sugar industries over proposals exchanged during bilateral
negotiations, but no immediate details of the proposals were
available.
The dispute broke out in June 1997 when Mexico slapped
preliminary antidumping duties on U.S. high fructose corn syrup
imports from $55.37 to $175.50 per metric ton of different grades
HFCS.
The U.S. protested those duties and has retaliated by excluding
Mexico from increases since then in its sugar import quotas.
Local Industry Presses For Panel
Mexican sugar industry representatives, however, said they were
skeptical a deal could be reached and that talks had largely broken
down.
"The talks have practically been suspended, we don't know of
any more talks," said an official with a large Mexican sugar
group.
Another sugar industry source said the National Sugar and Alcohol
Industry Chamber was preparing a formal request to the Commerce
Ministry, known as Secofi, to go ahead and request the panel.
"The chamber is now preparing a letter to Secofi requesting
that Mexico ask for the panel, the whole industry wants that to
happen," said the source.
In a Chapter 20 panel NAFTA dispute, Mexico will challenge the
legality of a sideletter agreement limiting Mexico's access to U.S.
duty-free sugar imports, and seek to have the original NAFTA sugar
chapter implemented, giving Mexico the right to export its entire
surplus production as of Oct. 1, 2000.
The U.S. sugar industry has opposed this, fearing Mexico would
flood its already oversupplied sweetener market with more sugar.
Mexico's surplus sugar production for the current 1999/2000
harvest cycle is expected to reach about 600,000 tons, but was as
high as 1.2 million tons in the record 1997/98 harvest year.
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