The Globe and Mail reports in its Saturday edition that the Mexican government is working
on a compromise proposal to
tighten the so-called rules of origin. The Globe's Adrian Morrow writes that unnamed sources say Mexico
is trying to find a way to placate
the United States by
squeezing overseas content out of
North American-made cars and
trucks.
Sources say the idea has not yet been finalized.
Under the current rules of origin,
autos must contain 62.5-per-cent
North American content in order to
be shipped between the NAFTA
countries without paying tariffs. A
list called the "tracing requirements"
spells out which exact
components of the vehicles count
toward the content requirement.
The U.S. has
demanded that a new 50-per-cent
U.S. content requirement be
imposed on autos made in Canada
and Mexico, the North American
content requirement be jacked up
to 85 per cent and the tracing list
expanded to include every component
of a vehicle.
The proposal Mexico is crafting,
the sources said, would offer Donald
Trump a more extensive tracing list
and possibly the 85 per cent North
American content requirement in
exchange for the U.S.
withdrawing the 50-per-cent U.S.
content provision.
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