The energy dispute between Mexico, the United States and Canada places the Mexican government at a crossroads.
Sooner than later you will have to solve it. And for this, he does not have many alternatives, nor time.
Among the alternatives are: 1.- Change the energy policy and recognize that it is not respecting the agreements signed by this government, in the T-MEC; 2.- Attempt to negotiate one-on-one with the companies that have expressed disagreements and; 3.- lose in the dispute resolution panel and inherit to the next government, the impact of the tariff sanctions that would be applied to different national productive sectors.
The clock started counting down since, on July 20, the US government requested the respective consultations with the Mexican government. It would later be joined by the government of Canada.
The times indicate that the final opinion could be known in the month of May of next year.
The two most important trading partners of Mexico began a process that could lead – if an agreement is not reached during the dialogue period – to litigation and the eventual imposition of tariffs on Mexican exports.
The disagreement of the US and Canada is basically due to the public policy and regulatory actions of the Mexican State that have negatively impacted US companies in the energy sector to benefit the Federal Electricity Commission (CFE) and Petróleos Mexicanos (Pemex).
The US government claims that the energy policy of the current administration, applied as of 2019, violates the disciplines to which the Mexican State committed itself in the T-MEC, particularly in chapters such as market access, investment and state-owned companies. .
The Commercial Representation Office (USTR) highlights as a reason for the consultation request: 1.- the change in the order of electrical dispatch to benefit the CFE plants over private generators, established in the reform to the Law of the Electricity Industry of March 2021.
2.- The revocation and rejection of new electricity generation and oil product storage permits, as well as the restrictions on the operation of service stations and fuel imports by the Energy Regulatory Commission (CRE) and the Secretary of Energy (Sener).
3.- the regulation of December 2019 that extends the term only to Pemex to comply with the Official Mexican Standard that establishes the maximum limits of sulfur content in automotive diesel (NOM-016-CRE-2016),
4.- The June 2022 warrant from Sener to the National Center for Natural Gas Control (Cenagas) and the CRE to force users of the natural gas transportation service to buy the hydrocarbon from the CFE subsidiaries.
The concerns of the US and Canada regarding Mexico’s energy policy are very specific.
For several months, the warnings from different groups of businessmen, legislators and US officials have made such concerns clear and the Mexican government not only did not heed them, but also minimized them.
Then would come the request for consultations within the framework of the T-MEC by the United States and Canada.
The initial presidential reaction was surprising because he responded with the song by El Chico Che, which says ¡Uy Que Miedo!
But the surprise did not stop there because just a few weeks later the presidential statement changed. He first announced that he would no longer post his government’s position on September 16, as he had anticipated.
He also said that President Joe Biden is his friend and that he really liked the letter he had sent him.
Everything indicates that the Mexican government, despite this, is not going to change its energy policy.
The alternatives are not many. Time is short. We will see.
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