RESTRICTEDWORLD TRADE
ORGANIZATIONG/SCM/Q2/MEX/17
25 September 2001
(01-4554)
Committee on Subsidies and Countervailing Measures Original:  Spanish
SUBSIDIES
Replies to Questions by the UNITED STATES1 Relating to the Notification
by MEXICO2 for 1999 and 2000
The following communication, dated 4 September 2001, has been received from the
Permanent Mission of Mexico.
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Question 1
The US Department of Commerce identified several subsidy programmes in its latest
CVD administrative review of imports of cut-to-length carbon steel plate from Mexico.   Pleaseindicate why the following programmes were not notified, e.g., have some of the programmes
been terminated?  If programmes have been term inated, please indicate legislative action under
which the termination was made.  Otherwise, plea se notify the following programmes or explain
why  you believe they do not fall within the scope of notifiable measure:
- Grants from the Mexican Institute for Steel Research (IMIS)
Reply
The Mexican Institute for Steel Research (IMIS) was closed down by a decree published in
the Official Journal (Diario Oficial de la Federación) on 4 November 1991.
- Bancomext export loans;
- Bancomext short-term import financing;- export financing restructuring;- Bancomext trade promotion services and technical support.
Replies
The National Foreign Trade Bank (Bancomext) finances and helps to promote foreign trade.
It operates as a development bank with economic independence from the Government of Mexico .  It
acts independently, and has its own assets and legal status.
                                                     
1  G/SCM/Q2/MEX/16
2 G/SCM/N/48/MEX and G/SCM/N/60/MEX.G/SCM/Q2/MEX/17
Page 2
Bancomext provides financing to exporters with the resources it acquires in international
markets .  It receives no aid from the Government, since it operates with credit lines secured from
abroad .  Bancomext borrows at LIBOR plus 2 or 3 points and lends at LIBOR plus 5or 6.
- FONEI Long-Term Financing
Reply
The Government of Mexico terminated FONEI on 31 August 1998, by a decision published in
the Official Journal (Diario Oficial de la Federación).
- Empresas de Comercio Exterior or Foreign Trade Companies Programme
Reply
This programme is designed to promote the setting-up of marketing companies in order to
consolidate exports, in particular those of small and medium-sized enterprises .  The benefits are solely
administrative and are designed to support the export activities of small and medium-sized
enterprises.
- Article 15 and 94 loans
Reply
The credits established by Articles 15 and 94 of the Credit Institutions and Auxiliary
Organizations Law, are no longer in use since the Law was abolished pursuant to the second
transitional article of the General Law on Auxiliary Credit Activities and Organizations, published inthe Official Journal (Diario Oficial de la Federación) on 14 January 1985.
- Nafinsa Long-Term Loans
Reply
NAFIN is not funded by the Mexican Government .  It is a national credit institution which
acquires part of its resources through the issue of bank acceptances and the rest from deposits of
various kinds .  NAFIN grants loans at international rates such as LIBOR or PRIME, with an added
percentage.
Question 2
You stated in your reply3 to a question, concerning your previous notification4 about the
sectoral promotion programmes published by SECOFI, on 14 November 1998, that "The
Programmes published in the Official Journal of 14 November 1998 are not in operation.   In
accordance with the transitional article of th e decree in question, those programmes will come
into effect by 1 November 2000".
(a) Are these programmes now in effect?  If so, when did they come into effect?
                                                     
3 G/SCM/Q2/MEX/15
4 G/SCM/Q2/MEX/13G/SCM/Q2/MEX/17
Page 3
Reply
The programmes came into effect on 1 January 2001, pursuant to the first transitional article
of the publication in the Official Journal (Diario Oficial de la Federación) of 31 December 2000,
which replaced previous decrees (published on 14 November 1998, 9 May and 30 October 2000).
(b) Please provide further details about the programmes.
Reply
The sectoral promotion programmes (PROSEC) operate in the same way as "end-use relief"
does in the United States, Canada, the European Union, and other countries, in that the import ofvarious goods for use in the manufacture of specific products is permitted at a different duty rate.
Thus, the goods cannot be used for any other purpose.  These programmes do not provide exemption
from the payment of value-added tax, nor any other taxes or anti-dumping duties.
(c) What sectors/industries are covered by these sectoral programmes?
Reply
The products subject to the various programmes come from the following industrial sectors:
electrical;  electronics;  furniture;  toys, recreational games and sports equipment;  footwear;  miningand metallurgy;  capital goods;  photography;  farming machinery;  chemicals;  plastic and rubber
manufacturing;  iron and steel;  pharmachem ical products, medicine and medical equipment;
transport, other than the automobile industry;  paper and card;  wood;  leather and hides;  automobiles
and parts thereof;  textiles and clothing;  chocolates, sweets and other similar items;  coffee;  and
others.
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