Mexico has continued to violate U.S. trade laws by dumping subsidized sugar into our marketplace.
Our trade laws are intended to keep inefficient foreign producers from running businesses to the ground. Unfortunately, that is the situation we have found ourselves in with Mexico. Phillip Hayes, the media relations director for the American Sugar Alliance, a coalition of sugarcane sugar beet producers, spoke with Townhall about Mexico’s unlawful acts, and how the Trump administration is preparing to respond.
In 2013, he explained, Mexico started dumping their subsidized surplus sugar here in the U.S.
“They flooded the market, more than doubled their exports here and it absolutely collapsed the prices and the market,” he said.
As a result, the U.S. sugar industry lost $2 billion.
The ASA filed a lawsuit against Mexico, with the Department of Commerce and U.S. international trade commission, while the U.S. government launched an investigation. The government ruled unanimously that Mexico was violating U.S. trade law. As a result, we planned to place duties on the Mexican government, even as high as 80 percent.
Instead of imposing those duties, the Obama administration came to an agreement with the Mexican government in which the latter promised to stop misbehaving.
As you can imagine, they didn’t. Mexico is still harming the U.S. industry and Hayes pointed out that since the Obama administration’s “deal” with Mexico, the U.S. sugar industry has lost an additional $2 billion. In Hawaii, where sugar has been a huge part of the economy and culture for more than a century, the industry has been completely shut down.
The Commerce Department gave Mexico until June 5 to comply with our laws. If not, they will face duties. As the governments work on a new agreement, however, Mexico has not been extremely cooperative.
“They have been reluctant,” Hayes explained. “They’ve resorted to blackmail. ‘If you do not let us continue to break your trade laws, we are going to punish U.S. exports into Mexico.’”
Hayes, however, said Mexico should think twice before using the same tactics on the Trump White House.
“Personally, I think they are overplaying their hand,” he said. “What I know is that the Trump administration – they do not seem like the kind of people who would bend to extortion and blackmail. I think they have been standing strong.”
As mentioned, the Commerce Department, led by Commerce Secretary Wilbur Ross, are prepared to places tariffs on Mexico come Monday should they not step in line.
U.S. workers and businesses continue to lose work because of Mexico’s unlawful practices. Yet, Hayes pointed out that every day Americans should be concerned about other factors at play – like their food supply.
“It’s jobs and our ability to produce food in this country is a key component of our country’s national security,” he said. “Sugar is a key ingredient of the human diet. This is about more than just sugar. This is really precedent setting. It’s going to send a clear signal not only to Mexico but to China and other countries that, when we have a trade deal, you must abide by it.”
To make Mexico accountable, the American Sugar Alliance has released ad campaigns in Washington, D.C. and reached out to members of Congress and the White House.
“Everyone agrees that trade cheats need to be held accountable.”