The request to send the dispute to arbitrators was announced on Thursday after formal consultations failed to resolve deep divisions between the two close trading partners over the use of genetically modified (GM) corn, widely produced by US farmers.
Washington alleges that a Mexican decree banning imports of GM corn used in dough and tortillas for human consumption is not based on science and violates its commitments under the US-Mexico-Canada Agreement (USMCA) on trade launched in 2020.
If the panel rules in favour of the US and Mexico fails to comply with its directives, the USTR would ultimately win the right to impose punitive tariffs on Mexican goods, a move that could spark a rare North American trade war.
US Trade Representative Katherine Tai said in a statement that Thursday’s move was aimed at enforcing Mexico’s USMCA obligations to maintain science-based regulations on agricultural biotechnology.
“It is critical that Mexico eliminate its USMCA-inconsistent biotechnology measures so that American farmers can continue to access the Mexican market and use innovative tools to respond to climate and food security challenges,” Tai said.
Mexico buys about $5bn worth of corn from the US each year, making its northern neighbour the country’s largest trading partner. Most of those purchases are GM yellow corn used for livestock feed.
Mexico has sought US cooperation to jointly conduct scientific research on the health impacts of genetically modified corn, but Mexican officials told the Reuters news agency on August 3 that their US counterparts denied the request.
Mexico’s government on Thursday said it will defend its regulations against the US claims. The Mexican economy ministry said in a statement that its policies are “consistent with trade obligations” under the USMCA.
Mexico argues that biotech corn harms native varieties and may have adverse health effects.
The country had announced plans to phase out GM corn for human consumption and eventually for livestock feed after studying its health effects.
“What is being proposed is that we also set a date for studying the contents of yellow corn to see whether it is damaging to human health, even if it is used for animal feed,” Mexican President Andres Manuel Lopez Obrador said in November 2022.
“Because that takes time, we are offering a space of two years [for imports] in the case of yellow feed corn.”
But the US has largely dismissed Mexico’s concerns.
“Mexico’s approach to biotechnology is not based on science and runs counter to decades’ worth of evidence demonstrating its safety and the rigorous, science-based regulatory review system that ensures it poses no harm to human health and the environment,” US Agriculture Secretary Tom Vilsack said in the statement on Thursday.
He added that innovations in agricultural biotechnology to enhance yields also help ease the challenges of global food and nutrition security, climate change and food price inflation" https://www.aljazeera.com/news/2023/8/17/us-escalates-trade-dispute-with-mexico-over-genetically-modified-corn