----

Opinion of the European Economic and Social Committee on EU-Mexico relations

(2006/C 88/17)

On 1 July 2004, the European Economic and Social Committee decided to draw up an opinion, under Rule 29(2) of its Rules of Procedure, on EU-Mexico relations.

The Section for External Relations, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 26 January 2006. The rapporteur was Mr Rodríguez García-Caro.

At its 424th plenary session held on 14 and 15 February 2006 (meeting of 15 February 2006), the European Economic and Social Committee adopted the following opinion by 107 votes to four with six abstentions.

1.   Introduction

2.   Political, economic and social situation and outlook for Mexico

2.1   Political situation

2.2   Economic situation

2.3   Social situation

3.   Background and evaluation of the EU-Mexico Global Agreement

3.1   Background (16)

3.2   Assessment

Over five years after the entry into force of the EU-Mexico Economic Partnership, Political Co-operation and Co-operation Agreement (Global Agreement), the EESC believes that it is a powerful tool and that its progressive nature benefits both sides in the three areas that form the pillars of the Agreement (political dialogue, trade development and cooperation). The EESC is positive in its appraisal of the trade and investment figures and the strengthening of institutional dialogue. However, the EESC considers that the Global Agreement has not been implemented to its full potential; a number of comments are therefore included in this opinion.

3.2.1   Political dimension

3.2.2   Economic dimension

3.2.3   Cooperation dimension

3.2.4   Effects of the enlarged EU on relations with Mexico

4.   The EU-Mexico Global Agreement and the North American Free Trade Agreement (NAFTA)

5.   Institutionalisation of dialogue with organised civil society

6.   Conclusions and recommendations

Brussels, 15 February 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND

----

(1)  Point 5.5 of the opinion on EU-Mexico relations, adopted on 21 December 1995 (OJ C 82, 19.03.96, p. 68).

(2)  Point III of the summary and points 33, 34 and 35 of the Final Declaration adopted by the Third Meeting of European Union-Latin American-Caribbean civil society organisations held in Mexico on. 13, 14 and 15 April 2004. This document acknowledges the progress made on the recognition of cultural and ethnic diversity and the rights of indigenous peoples.

(3)  Report on Mexico by the International Monetary Fund (IMF) no. 04/418, 23 December 2004.

(4)  General Agreement on Tariffs and Trade.

(5)  According to Mexico's national council for the exporting maquila industry (Consejo Nacional de la Industria Maquiladora de Exportación - www.cnime.org.mx), maquila refers to the industrial or service-based process involving the processing, production or repair of goods of foreign origin which are temporarily imported and subsequently exported, performed by maquiladoras or companies that export under the terms of the Mexican decree for the supply and operation of the exporting maquiladora industry and its reforms. Industrial activity in Mexico includes the mining, manufacturing, construction, electricity, gas and water sectors. The fall in investment flows to the manufacturing sector between 2001 and 2003 led to a drop mainly in manufacturing and construction. During this period, the manufacturing sectors suffering the biggest reductions were those that were worst hit by the decrease in exports, especially the following: metal products (automobiles, electrical goods, electronics, machinery and equipment), textiles, clothing and leather, and chemical substances (oil, pharmaceuticals, rubber, plastic). The manufacturing sectors with the greatest reductions in actual production are those for which maquiladoras account for over 50 %, i.e. over half of their exports are from maquiladoras: for example, textiles and clothing (62 %), machinery and equipment (60 %) and wood (56 %).

(6)  According to the Mexican Department for Trade and Industry, all manufacturing industry subsectors recorded, between 2001 and 2003, an increase in unemployment of 17.8 % for maquiladoras and 13.8 % elsewhere, as compared to the 1995-2000 period. The recovery in 2004 has not affected employment indicators, which continue to show a downward trend.

(7)  Competitive pressure from China and its presence on the US and EU textile and garment market mean that other countries exporting to these markets will need to adapt. The consequences are particularly harsh for Mexico. Moreover, China's development potential poses a real threat to Mexico's current position, particularly as regards labour-intensive goods, given Mexican wage levels.

(8)  Analysis of competitiveness in Mexico. Mexican Institute of Competitiveness (IMCO). September 2003.

(9)  Ministry for Social Development. Development measurement. Mexico 2000-2002. 23 June 2003.

(10)  UN Bulletin no. 03/042, 17 June 2003, on the fundamental rights and freedoms of indigenous peoples in Mexico.

(11)  OECD Policy Brief, October 2002. Territorial reviews: Mexico City.

(12)  Poverty in Mexico: an assessment of conditions, trends and government strategy, World Bank, 2004.

(13)  OECD, Employment Outlook, 2005.

(14)  The Employment Observatory is an instrument set up by the Mexican government to improve the labour market. A delegation from the EESC was present when it was inaugurated by the President of Mexico at his official residence, Los Pinos, on 2 March 2005.

(15)  National Institute for Geographical Statistics and IT. Mexico City, 8 March 2004.

(16)  ‘EU-Mexico relations’, Permanent Representation of Spain to the EU.

(17)  Framework agreement which defined the trade negotiation rules, representing a fast track for initiating trade negotiations, via the Joint Council provided for by the Global Agreement.

(18)  Point 15 of the Communiqué by the EU-Mexico Joint Council, Luxembourg, 26 May 2005.

(19)  From June 2000, when the trade chapter of the Agreement came into effect, until June 2004, total trade between the EU and Mexico increased by 31 %, i.e. 111,000 million dollars. Europa en México, 2004, EU Delegation to Mexico, 2004.

(20)  All the FDI data are based on the information contained in: Europa en México, 2004, EU Delegation to Mexico, 2004.

(21)  Including Bulgaria and Romania.

(22)  In 2003, Mexico's population was 102 million (OECD Fact Book, 2005).

(23)  Joint declaration by the Free Trade Commission of the North American Free Trade Agreement. 16 July 2004.

(24)  Report on Mexico, Área de Estudios de Caja Madrid, May 2002. The World Bank ‘Lessons From NAFTA for Latin America and the Caribbean Countries: A Summary of Research Findings’ D. Lederman, W.F. Maloney and L. Serven, 2003.

(25)  World Bank, World Development Indicators Online.

(26)  John Audley, ibidem, p. 49.

(27)  Press release no. 71/04, Mexican Ministry of the Interior, 17 December 2004.

(28)  Source: the Mexican Association of Importers and Exporters (ANIERM), with data from the Ministry of the Economy.

(29)  However, it should be noted that of this 90 %, oil accounted for 10 % and assembled products for 50 %.

(30)  Article 10 of the EU-Chile Association Agreement (in force since 1 March 2005, OJ L 352 of 30.12.2002) establishes the ‘Joint Consultative Committee’ whose role is to ‘to assist the Association Council in promoting dialogue and cooperation between the various economic and social components of organised civil society’ in the EU and Chile.

(31)  Article 1 of the bill.

(32)  For more information, see the following website: http://www.stps.gob.mx/consejo_dialogo/cpdsp/frameset.htm.

----