The private sector and trade organizations in the United States have warned that the upcoming USMCA talks, as part of their review in 2026, are at risk of being undermined due to the constitutional changes contemplated by the legal reform.
“While the Mexican government has the sovereign right to amend its constitution, we believe that some of the proposed constitutional changes (such as judicial reform) risk damaging the long-standing trade and investment relationship between the United States and Mexico, as well as the rights of U.S. companies under the USMCA,” warned various business chambers in a letter addressed to Secretary of State Antony Blinken.
“The reforms include a proposal to the legal system to remove all judges and replace them by popular election, which poses significant risks to the fundamental rule of law and the administration of justice in Mexico. Without the ability of U.S. investors to have fair and predictable recourse in Mexico’s judicial system, the implementation of the USMCA will come under additional pressure,” they indicated. Therefore, the U.S. private sector urged the Secretary to raise these concerns and recommend to the incoming Government of President Claudia Sheinbaum a slower and more deliberative approach to the reform of the Legal Branch.
In addition, they expressed their concern about the other reforms included in the so-called Plan C of the 4T.
“Among our key concerns are reforms to weaken or even eliminate several autonomous regulatory bodies, such as the Federal Telecommunications Institute (IFT), by firing the expert professionals within them in order to codify preferential treatment of state-owned enterprises over private sector companies; weakening investor protections; and outright banning sales of U.S. agricultural products and certain types of foreign investment such as open-pit mining. Several of these reforms appear to violate Mexico’s obligations under the USMCA. In recent years, the USMCA has gained relevance between the economies of both countries, as trade in goods and services between the United States and Mexico has grown to an all-time high, reaching nearly $900 billion in value by 2023. Likewise, U.S. companies have increasingly made investments directly in Mexico. The volume of U.S. investment in Mexico reached $144 billion in 2023, with nearly $50 billion of that investment made in the past nine years alone. “We are deeply concerned that the Executive’s proposed constitutional reforms will harm not only Mexico’s attractiveness as a place to invest and do business, but also North America’s potential to maintain its competitive position in an increasingly complex global economy. With the USMCA as the foundation for that competitive position, we believe the Mexican Government must take into account its obligations under the Treaty and the value of the agreement to the United States and Mexico, which will be jeopardized if these reforms are enacted as currently proposed,” they said. The letter was signed by the Advanced Medical Technology Association; the American Chemistry Council; the American Clean Energy Association; the American Petroleum Institute; the Service Industries Coalition; the Electronic Components Industry Association; the Information Technology Industry Council; the National Association of Manufacturers; and the National Mining Association.
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