Mexico’s trade with Georgia goes way beyond peaches and tequila.

Most of what we trade are intermediate goods, as part of a complex and successful supply chain that has made our region the most efficient manufacturing hub in the world.

Javier Díaz de León, the consul general of Mexico in Atlanta. (Special)

Since the North American Free Trade Agreement came into force in 1993, Georgia’s exports to Mexico have increased by 781.8 percent, while those to the rest of the world have risen 356.6 percent. This means that Georgia’s export growth rate to Mexico is 2.2 times higher than its export growth rate towards the rest of the world. As of today, Mexico ranks as Georgia’s third trading partner in the world and the second buyer of goods from Georgia (Canada being the first). Mexican companies operate over 190 businesses in Georgia and provide 3,900 local jobs. On the other hand, over 152,500 jobs in Georgia rely on trading with Mexico.

At the end of May, the U.S. federal administration announced steep tariffs on steel and aluminum imported from some of its closest allies, including Mexico. As a response, Mexico’s Ministry of the Economy imposed equivalent measures to various U.S. products up to an amount comparable to the level of affectation.

The U.S. Chamber of Commerce estimates that these tariffs threaten to spark a global trade war and represent a tax increase on American consumers and businesses, including manufacturers, farmers and technology companies, who will all pay more for commonly used products and materials.

Retaliatory tariffs imposed by other countries on U.S. exports will make American-made goods more expensive, resulting in lost sales and, ultimately, lost jobs. This scenario potentially impacts 1,283,800 Georgia jobs supported by trade and over $749.8 million in Georgia exports to Mexico.

Regarding the possibility of imposing tariffs on automobiles and auto parts to allegedly protect national security, during a recent Commerce Department hearing, Mexican Ambassador to the United States Gerónimo Gutiérrez noted the integrated nature of North American vehicle production, where parts can cross the border many times before a car is completed. “Mexico stands firm against the use of a national security argument in an effort to restrict trade or gain negotiation leverage. We will remain vigilant for any unjustified trade restriction and will exercise our rights to ensure that the Mexican automotive industry is not adversely affected.”

It is worth noting that the tax on foreign cars and auto parts that the U.S. administration is considering is not only opposed by the closest trade allies of the U.S., but also by auto manufacturers and makers of auto parts, who have warned that it would drive up the price of cars by thousands of dollars and cause the loss of anywhere from 200,000 to 600,000 jobs, depending on the extent of trade retaliation.

Regardless the size of the tariffs, the impact on overall exports and the ensuing retaliation, what we should focus on is how the narrative is changing on how we relate as neighbors in this common manufacturing space. For the last two decades, Mexico, the United States and Canada have had a free trade agreement with no tariffs on goods going back and forth. We have had disputes on several occasions, but the basic consensus has been to settle them within the framework of the NAFTA agreement. That is how we have been interacting with each other for the last 25 years, but now we face the need to update our agreement in a way that it better reflects current technological advances and new challenges to global trade.

Since 1993, we have built in North America the most efficient and competitive manufacturing powerhouse in the world. We must work together, as the three partners and allies that we are, in order to find a way to consolidate our win-win-win formula. North America first.

Javier Díaz de León is the consul general of Mexico in Atlanta.

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