MEXICO CITY (Reuters) – A U.S. proposal for Mexico and Canada to vastly raise the value of online purchases that can be imported duty-free from stores like Amazon.com and eBay is emerging as a flashpoint in an upcoming renegotiation of the NAFTA trade deal. 

Vulnerable industries like footwear, textiles and bricks and mortar retail in Mexico and Canada are pushing back hard against the proposal by the U.S. trade representative to raise Mexican and Canadian duty-free import limits for e-commerce to the U.S. level of $800, from current thresholds of $50 and C$20, respectively. 

For the Mexicans, the main worry is that such a move could open a back door for cheap imports from Asia and beyond. For Canadian retailers, the fear is that e-commerce companies will undercut their prices. 

The U.S. plan was unveiled in July as part of the Trump administration’s goals to renegotiate the 25-year-old treaty. 

While Mexico and Canada are still formulating their responses, Mexico City is leaning strongly against the proposal in its current form, and Ottawa may not be far behind. 

The proposed $800 level “opens a completely unnecessary door” to imports from outside the NAFTA trading bloc, Mexican Economy Minister Ildefonso Guajardo said on Thursday on the sidelines of a NAFTA-related event, calling it “a very sensitive topic.” 

The growing controversy over how to account for a burgeoning regional e-commerce sector dominated by the United States highlights a rare area where the Trump administration is pushing to liberalize trade rules rather than tightening them. 

Much of Trump’s criticism of NAFTA stems from his belief it has decimated U.S. manufacturing as companies shifted production to Mexican factories with cheaper labor, creating a U.S. trade deficit with Mexico worth more than $60 billion. 

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But Mexican and Canadian business leaders fear the rule change could make their industries vulnerable, arguing that unless online retailers can show products are made in North America, they should not be exempted from duties levied on other imports. 

“We can’t open the door to inputs from outside the region coming in tax-free when we’re talking about the need to reduce the deficit and create jobs,” said Moises Kalach, who fronts the international negotiating arm of Mexico’s CCE business lobby. “It goes completely against that.” 

Guajardo said Mexico’s retail group the National Self-service and Department Store Association, which includes powerful members such as Wal-Mart de Mexico, had visited him last week to express concerns about the proposal. 

He said the group’s representative brought to the meeting a $250 jacket bought on the internet as evidence that violations to the existing limit were already threatening members’ businesses.

“Suppose there was an $800 free limit. Can you imagine how many shirts Vietnam could send to Mexico in a packet below that price? They could easily flood us with packets of 100,” he said, while recognizing the need to smooth customs processes. 

Complicating efforts to agree on a common set of rules is a tangle of diverging regulations on tax and how the restrictions on imports differ in the region depending on whether they enter by air, sea or land. 

Amazon.com Inc and eBay Inc declined to comment for this story. 

eBay has previously said it supports an increase to Canada’s low-value customs ‘de minimis’ threshold for ecommerce to promote seamless access to the global marketplace.” Increasing the threshold “absolutely” is eBay’s top priority in the NAFTA renegotiation, a person familiar with the matter said.

Canadian opposition is being led by retailers, whose industry association said it was concerned about “the behavioral shift that would inevitably result if shoppers can buy a far wider range and higher value of goods tax-free and duty-free.” 

The Retail Council of Canada said in a submission to the government that clothes, books, toys, sporting goods and consumer electronics would be among the items most affected, and expressed confidence Ottawa would fend off such requests. 

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“eBay in particular has lead this charge to three different finance ministers in a row – Jim Flaherty, Joe Oliver, and Bill Morneau – and in each case they have failed,” said Karl Littler, a spokesman for the Retail Council of Canada. 

There have been hints from Canada’s government about a compromise under which a higher limit would exempt products ordered from e-commerce from duties but not sales taxes. 

“When it comes to waiving duties and taxes, we need to carefully consider the impact that would have on Canadians and on Canadian businesses,” said Chloe Luciani-Girouard, a spokeswoman for Morneau. 

Mexican firms could accept a higher import limit for goods produced in the NAFTA region – but not from other nations, said Alejandro Gomez Tamez, executive president of the Chamber of Commerce for the footwear industry in the central Mexican state of Guanajuato, a hub of textile manufacturing. 

“When a product comes in, even if it’s packaged and sent from the United States, if it’s from a third country, it should pay duties,” he said.

The rhetoric against a neighbouring country dominated Donald Trump’s presidential campaign: a billion-dollar wall, a crackdown on immigration, and a steep border tax. Yet when Trump fired the opening shot in his trade war, it was aimed not at Mexico – but at Canada.

First came an average 20% tariff on Canadian softwood lumber. Months later the Trump administration piled another tariff of nearly 7% on the sector. 

Trump launched a broad attack on several sectors north of the border. “Canada, what they’ve done to our dairy farmworkers is a disgrace,” he told reporters. “We can’t let Canada or anybody else take advantage and do what they did to our workers and to our farmers … included in there is lumber, timber and energy. So we’re going to have to get to the negotiating table with Canada very, very quickly.”

The sharp reversal – a few months earlier Trump had characterised the US-Canada relationship as “outstanding” – came as a surprise to many. 

“Step aside, China and Mexico: Canada is now Donald Trump’s whipping-boy du jour on trade,” said the Canadian Press, while Politico offered their thoughts on why president had not gone after Mexico first: “Canada is an easy target and doesn’t have as many weapons to fight back.”

Others said it was long overdue. “Canada was getting a free ride,” said Federico Estévez, a professor at the Autonomous Technological Institute of Mexico. “All of the fire was headed south of the US border – so Canada was getting off easy.”

Estévez pointed to the looming renegotiations of the North American Free Trade Agreement to explain the turnaround. “I think Trump understood something basic, which is that the US will not be able to tweak Nafta or rework it unless it splits up Canada and Mexico and makes Canada squirm just as well,” he said. “You want to open up some battlefronts – and that’s what he’s effectively done, to the surprise of everybody.”

With the renegotiations slated to begin on 16 August, all of the interactions of past months – from pleasantries to attacks – are again under the microscope. Against a backdrop of grievances over trade deficits and protectionist policies, officials in both Canada and Mexico are also scrambling to shore up strategies to best handle a president who ranks among the more unpredictable elements of the upcoming negotiations. 

Both countries have much at stake. Canada sends about three-quarters of its annual exports to the US while nearly 400,000 people a day cross the shared border. In Mexico, some 80% of exports end up in the US.

Mexican and Canadian officials have been laying the groundwork for months. Trudeau’s inner circle have fostered close contacts with the Trump administration, while representatives from Canadian government and business have been criss-crossing the US to reinforce how Americans benefit from their relationship with Canada, said Colin Robertson of the Canadian Global Affairs Institute.

“There have been, I think, 170 visits by Canadians to the States since January. And not just to Washington but also into Trump territory,” he said. “And it’s not just ministers, it’s legislators and premiers and provincial legislators.” 

The aim, said Robertson, is to mitigate what he described as Trump’s “situational politics”, which see the president shift stances depending on the audience he’s addressing. He pointed to Trump’s swipe at Canadian dairy as an example, as it came while the president addressed an audience in Wisconsin.

In Mexico, the job of managing relations with the Trump administration has fallen to Luis Videgaray, a foreign minister whose experience in the world of finance has overlapped with Trump’s son-in-law Jared Kushner. 

Despite initial setbacks – Trump signed an executive order to build the border wall and tweeted that Mexico would pay for it even as Videgaray was heading to Washington to meet with Kushner – the minister and his small team have earned some plaudits as the threat of Trump has apparently diminished for Mexico and the peso bounced back after a Trump-inspired slump. 

So far, Mexico’s strategy for handling Trump seems to lie in trying to save some provisions of Nafta at all costs, such as investor protections, analysts say.

The government closed online consultations late last month, though it has attracted criticism for appearing to pay closer attention to the country’s big business elite while ignoring the interests of smaller firms and beleaguered workers. 

“I’ve not read the national interests of Mexico spelled out,” said Carlos Heredia of the Centre for Research and Teaching of Economics. “There hasn’t been any sort of open consultation – the online consultation is sort of a joke – but there’s nothing saying, ‘We are going to represent the national interest of Mexico, not just the top echelons of business and politics.’”

Mexico released its objectives for Nafta negotiations last week. It joined Canada in opposing US plans to eliminate dispute resolution mechanism known as Chapter 19, but also will propose anti-graft initiatives and provisions for small business and the digital economy. Energy will also be on the table as Mexico approved a reform to open its oil industry in 2013.

From immigration to the environment, Trump’s political stances – widely despised in both Mexico and Canada – could colour discussions at the negotiating table, raising questions of how America’s neighbours will respond.

While Trudeau’s approval ratings remain high, suggesting many Canadians are comfortable with his reluctance to chastise Trump,Mexico’s Enrique Peña Nieto is even more unpopular than the US leader – and his apparent unwillingness to talk tough with Trump is widely as a weakness.

“The greatest problem of the Mexican response to Trump has been that the Mexican government has acted over and over again as if the constituency of its foreign policy were only one person: Donald Trump,” said Carlos Bravo Regidor of CIDE. “This has left it open to vulnerabilities, the most of important of which is an inability to voice the legitimate grievances Trump causes many regular Mexicans.”

Despite their differences, Trump has demonstrated a level of cordiality and friendship with Trudeau, said Laura Dawson, who heads the Canada Institute at Washington’s Wilson Centre.

“It’s kind of funny in the tweets that I’ve been reading. When he’s talking about his two neighbours, he calls them, Justin and the Mexican president,” she said. “I don’t know if he doesn’t know Trudeau’s last name, I don’t know if he knows Peña Nieto’s name at all – but its always Justin and the Mexicans.”

What’s certain is that Canada and Mexico now realise they’re in it together. “There was some public opinion, at least in Canada, that we could go at it alone, without Mexico because they’re in the crosshairs and we’re not. I think that that sentiment has really subsided,” said Dawson, pointing to official statements from both countries that reiterate the importance of the trilateral agreement.

While Trump has gone after both neighbours, he’s also demonstrated that he’s open to changing his mind on things, said Dawson.

“He’s willing to find a parade and get in front of it, so I think that if Canada and Mexico are skillful enough about giving the president some wins that he can claim – you know, modernisation of the agreement, certain things that affect labour or manufacturing – I think they can also move ahead on the modernisation agenda on the Nafta.”

TEMPO.CO, Jakarta – A manufacturing company originally from Japan, Toyota Motor Corp. plans to produce pickup trucks and sport utility vehicles (SUVs) at a new plant located in the Mexican state of Guanajuato.

“We will concentrate only on pickup trucks in the beginning, and are studying the potential of SUVs in the future,” said Luis Lozano, a spokesman for Toyota Mexico, as quoted by Reuters on Sunday, August 6, 2017.

Lozano said the plan for now is that the company will assemble Tacoma truck models. As for the SUV model, it is still in the learning stage.

Both models are indeed quite lucrative products for the North American market. Trucks and SUVs account for about 65 percent of the market in North America.

This decision was taken when Toyota took a 5 percent stake from Mazda Motor Corp. as part of its second alliance to set up a factory in the United States with an investment value of $ 1.6 billion.

The investment value incurred by the company in the region will be the same although there will be a change of plan. “The investment we counted when announcing the decision to set up a plant is worth USD 1 billion,” said Lozano.

San Antonio-based refiner Valero Energy Corp. announced Thursday a long-term deal to export refined fuels to Mexico.

The deal with IEnova, a Mexico-subsidiary of San Diego, California-based energy services company Sempra Energy, will utilize a new $155 million, 1.4 million barrel refined product storage facility located in the Gulf of Mexico port of Veracruz. 

The facility — which has a 20-year concession agreement with the Port Authority of Veracruz — will hold gasoline, diesel and jet fuel and will be completed by the end of 2018, according to an IEnova news release. 

“With the recent Constitutional reform, it is now possible for Valero to import refined products directly into Mexico for further distribution, including branded sales,” Joe Gorder, Valero’s president and CEO, said in a news release. “This transaction will enable us to extend our supply chain to efficiently supply gasoline, diesel and jet fuel to the growing Mexican market.”

The governments of Mexico and Japan on Monday ratified a bilateral free trade agreement as part of the visit by the Mexican Foreign Minister Luis Videgaray Caso to Japan.

Officials underscored the relevance of the bilateral economic relationship, which has surpassed US$ 21.5 billion, placing Japan as Mexico’s third largest trading partner. Japan is the only country in Asia with which Mexico has a free trade agreement in force.

During the meeting, Caso and his Japanese counterpart, Fumio Kishida, highlighted as “excellent” the bilateral relations and the increase in direct investment in Mexico, which attracted more than a thousand Japanese companies to the country.

This time, they did not hold a press conference with Trump.

When then-Candidate Trump found out in February of 2016 that Carrier would be closing their Indianapolis plant and sending those 2,100 jobs to Mexico, it became a cornerstone of his campaign. He railed against companies like Carrier for outsourcing jobs and threatened penalizing them with heavy tax.

“If they’re going to fire all their people, move their plant to Mexico, build air conditioners, and think they’re going to sell those air conditioners to the United States — there’s going to be a tax,” Trump said at a rally in April. “It could be 25 percent, it could be 35 percent, it could be 15 percent — I haven’t determined.”

After winning the election, Trump and then-Vice President-elect Mike Pence announced with much fanfare in late November that they had reached a deal with Carrier to keep around 1,000 jobs at the company’s Indianapolis plant

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Just after the election and before his inauguration, Trump held a huge rally in Indianapolis as part of his post-election “thank you” tour. In the speech, he said he was thankful for the “two massive victories, one after another” and took credit for saving the Carrier jobs, asking the crowd, “isn’t is nice to win?” The Carrier deal was seen by his supporters as proof that the incoming president’s business savvy was enough to keep American jobs from being outsourced.

Following the Carrier announcement, he warned that business that left the United States would face a heavy tax, up to 35%.

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Now, six months into his presidency, Trump doesn’t appear to be making good on that promise

Today, 338 employees will be let go from their jobs at the Indianapolis plant in the first wave of cuts at Carrier. In total, 630 people will lose their jobs by the end of the year as Carrier relocates their fan coil production to Mexico. Additionally, Carrier’s parent company, United Technologies Corp., is still forging ahead with their plans to close the Huntington, Indiana plant, affecting around 700 workers — all these jobs, heading to Mexico without any repercussion.

Since the election, Trump has established a pattern of taking credit for saving or creating jobs that his deals had nothing to do with. For example, Trump took credit for a statement in a press release written by Toyota announcing that it is spending $1.3 billion at a Kentucky plant that will build its new Camry. “Toyota’s decision to invest $1.3 billion in their Kentucky plant is further evidence that manufacturers are now confident that the economic climate has greatly improved under my administration,” reads the Trump quote in the press release. But the company made clear that the news is not related to his administration. In fact, Toyota began preparing for manufacturing the new Camry during President Obama’s term.

And while Trump and Pence took credit for saving Carrier’s Indianapolis plant, current union chief Robert James told the Indianapolis Star that sentiments among the workers aren’t optimistic at all.

“They just don’t have any faith in this plant staying in Indianapolis,” James said. “There’s just too much uncertainty.”

In December, Chuck Jones, then-president of the United Steelworkers Local 1999 union that represents Carrier workers, gave multiple media interviews pushing back on Trump’s claim that the deal was a victory for workers. He said Trump “lied his ass off” when it came to saving 1,000 jobs and said the details surrounding the kind of deal Trump and Pence struck with Carrier were dubious. In a statement following the deal, Carrier announced that “the incentives offered by the state were an important consideration” to staying. The incentives, paid by Indiana taxpayers, amount to $7 million over a decade — $700,000 a year.

Trump is promising to reverse economic forces outside of any individual’s control. With automation accounting for 50 percent to 90 percent of job losses at American factories, cuts to low-skill manufacturing jobs will continue to be made, regardless of any “deals” struck up by people like the president. UTC has pledged to spend $16 million on plant upgrades, including automation. Job numbers reinforce Trump’s Carrier “deal” occurred amid a long-term downturn in manufacturing jobs in the country. Into 2017, manufacturing jobs have shown very little growth.

Meanwhile, Trump is highlighting products from companies still manufacturing in the United States during the White House’s “Made in America” week, because America sets the “world standard for quality and craftsmanship.” If American products set the “world standard,” then products made overseas, like the majority of the Trump Organization’s products, fail to meet that standard, despite Trump routinely touting them as the best.

MEXICO CITY, July 18 (Xinhua) — Mexico’s private sector said Tuesday it was ready to accompany the government delegation in the upcoming renegotiation of the North American Free Trade Agreement (NAFTA).

Talks on the two-decade deal between Mexico, the United States and Canada are to begin in August in a bid to address U.S. President Donald Trump’s concerns that the existing agreement harms U.S. industry and jobs.

The president of Mexico’s Business Coordinating Council (CCE), Juan Pablo Castanon, said in a statement that the various economic sectors have held more than 200 meetings since the beginning of the year to hammer out a unified strategy on each of the points to be debated.

“We have carried out extensive preparatory work with each sector of the economy … we are united and prepared,” said Castanon, whose organization gathers Mexico’s leading business and industrial chambers.

Business leaders have formed an intelligence group to support the negotiating team with information, analysis, potential scenarios and concrete positions, he said.

The CCE has also consulted with politicians and lawmakers, workers and academics, and industry observers, as well as establishing communication channels with its U.S. and Canadian counterparts, he added.

NAFTA should be renegotiated with the goal of increasing North America’s competitive edge and jobs market, while looking out for the interests of Mexico’s productive sectors, said Castanon.

“We firmly believe in our open (economic) model and we will strive to find means of integration that will continue to strengthen North America as the world’s most competitive region,” said Castanon.

Trump believes the U.S. economy has suffered factory closings and the loss of jobs since the treaty went into effect in 1994

A visit to the country’s Bajío region finds a thriving car ecosystem.

When Donald Trump won the U.S. presidency in November with a promise to lure back manufacturing jobs, Sean Patton trimmed his sales projections for 2017. Patton is head of business development for Genesis-ICESA Systems, a family-run automation integrator based in Mexico’s Bajío region. His company largely caters to the country’s burgeoning automotive industry, a big exporter to the United States.

Midway through 2017, however, it looks as if Mexico’s automotive engine can’t be stalled: the industry is anticipating its eighth consecutive year of record-high production and exports. And in a bid to stay competitive, the Mexican car industry is embracing ever more automation. Genesis-ICESA, which has installed more than 500 robots since its founding in 1974, has seen its bookings double in the first half of 2017 over the number for the first half of 2016, putting the company on track for its best year ever. “It’s going to be a very good year for robotics,” says Patton.

Just as U.S. manufacturers are increasingly turning to robots take on work once done by humans, so too is Mexico heading toward a future of increasingly automated factories. The Boston Consulting Group predicts that Mexico will rely on robots for slightly more than 30 percent of tasks by 2025, versus a current global average of 10 percent. China, Japan, and the U.S. are automating at an even faster pace, with BCG forecasting that those countries might use robots for as many as 45 percent of tasks eight years from now.

Helping Mexico get there will be firms like Genesis-ICESA, which designs and assembles the workstations that automate certain manufacturing tasks. On a sweltering Thursday in June, Patton gave me a tour of his 40,000-square-foot facility, on the grounds of a former tire factory. Fluorescent lights shone on brightly hued machines and metal structures scattered across two immense warehouses—splashes of red, blue, and yellow against drab concrete floors. The sound was cacophonous as metal clinked against metal and air compressed inside a giant press that precisely shaves steel slabs.

Genesis-ICESA employs nearly 100 Mexicans, mostly engineers who design or assemble the workstations known as cells. Inside each cell, one or more robots will perform specific tasks at client factories, such as fastening screws into an auto part. Some stations are self-contained crates that can be shipped whole, while others resemble props in a play that must be restaged.

On this particular day, there’s a contraption with clamps that Genesis-ICESA built to hold Tesla seat supports while a robot fuses the pieces together; a caged-in area where a towering white robot from a company called Nachi welds sun-roof frames for Ford; and an orange lift-assist station that will mount doors for Navistar. With a slight nudge, a heavy-looking lever on the lift assist swings from right to left, like workout equipment without resistance, allowing workers to move 100 pounds with just one pound of force.

Mexico is now the sixth-biggest producer of vehicles in the world. The country has two dozen auto production plants, and in recent years it has attracted the majority of new car-factory openings in North America. Genesis-ICESA targets those carmakers’ suppliers, and the lines the firm designs typically stay in Mexico. Most of the products made on those lines will go to the U.S. eventually. Four out of five light vehicles assembled in Mexico today are sold to U.S. consumers.

Genesis-ICESA customers like GeNI, a Mexican auto-parts maker backed by Germany’s GEDIA Automotive Group that stamps out parts for carmakers such as Nissan and Volkswagen, visit the factory for final tests and tweaks before the cells are shipped to their factories.

On the factory floor the day of my visit, GeNI engineer Leopoldo Ortiz looks over a two-tiered work station that Genesis-ICESA designed for his factory in Puebla, a city three hours by car from the Bajío region. In it, a $130,000 welding machine inserts bolts into an aluminum car part. Then the piece is wedged into a $30,000 table to check that all the bolts are properly in place. The workstation is meant to eliminate the margin for human error, says Ortiz:“We need to be more efficient. If you have more people, you have more risk.”

Nearby, three Genesis-ICESA employees are training a cobalt-blue robot made by Yaskawa to trace simple shapes: squares, triangles, and circles. A giant arm retracts and descends. As it draws, the robot emits a shrill sound similar to the whir of a dentist’s drill.

René Sánchez, the 31-year-old engineer leading the Yaskawa through its calisthenics, appreciates that robots can help workers lift heavy objects or weld materials without inhaling harmful fumes. But he’s also wary of their ascent. “The disadvantage is that they eliminate the operator—a lot of people won’t have jobs,” says Sánchez.

Wages in Mexico are low compared with levels in the U.S., where the average auto worker makes more in an hour than a Mexican worker makes in a day. So robots aren’t always the cheapest solution here. In the near term wages are projected to remain low, keeping the country’s sizable manufacturing workforce employed in the coming decade.

A record-high 5.15 million Mexicans worked in manufacturing as of May, nearly a quarter of all workers registered with the country’s social security institute. Around 202,000 Mexicans joined the ranks of manufacturing workers during the first five months of this year alone.

“What I see in Mexico is there’s a balance between automation and manual labor, where you take advantage of both,” says Patton. Grueling and repetitive jobs will get automated, while tasks that require eyes, ears, a sense of touch, and a brain should still be done by humans.

Thirty miles from Genesis-ICESA, down a bucolic road that cuts through farmland and head-high stalks of corn, the Belgian auto-parts maker Bosal has put multiple robot-assisted cells to work. In the past 18 months, Bosal has spent nearly $20 million on automation, much of that with Genesis-ICESA. The automation drive has cut back on Bosal’s local hiring needs, although strong demand for parts has still led the company to increase its Mexican workforce by 50 percent since 2014, says Luis Palomé, regional director for Bosal in Mexico.

The ambient noise on the floor of the Bosal plant in Querétaro is similar to that of a giant washing machine stuck on the spin cycle. Workers place mufflers into a station built by Genesis-ICESA that resembles a small shipping container. They punch buttons on a control panel. A safety curtain descends. Then the robot inside the box does the welding for them. Sparks fly behind a plastic window in the curtain.

Not far away, at a more manual station, workers earn on average $13.50 a day—three times Mexico’s minimum wage to insert metal tubes into a machine that then bends the tubes. At a Bosal plant in Michigan, the company paid $1 million to introduce a robot that feeds the same type of machine, the job still being done by hand in Mexico. The company amortizes its robotic cells over 10 years. In Mexico, Palomé explains,“it doesn’t justify the cost of a robot.”

That’s good news to Oscar González, a Bosal employee who has been pushing those tubes into a machine for the past year. The job requires teamwork, he says, questioning how a robot would collaborate with the coworkers weaving around him. “We’re not homogenous,” he says.

As Washington events go these days, the hearing on the North American Free Trade Agreement was a snoozer: panel after panel of speakers reading five-minute-long statements, one after another, followed by a round of questions from a team of government bureaucrats.

Yet the three-day public session this week made clear the extensive and intensive interest in the Trump administration’s upcoming renegotiation of NAFTA.

SHANGHAI — China is open to negotiating a free-trade agreement with Mexico, the official Xinhua news agency reported on Thursday, citing the Chinese ambassador to the country, a fillip for Mexico as it faces uncertainty over its trade deals with the United States.

Qiu Xiaoqi, China’s ambassador to Mexico, said China was willing to discuss a free-trade agreement, although no discussions had been held so far, Xinhua said. Qiu was speaking at an academic event in Mexico City.

“If we negotiate a free-trade agreement, this will greatly favour trade exchanges between our two countries. There is no difficulty from China’s side,” he said.

“Mexico is China’s second-largest trading partner in Latin America and China is Mexico’s second-largest trading partner in the world. This is a highly important relationship and we have great interest in deepening and broadening these ties.”

Mexico is keen to cut its economic reliance on the United States out of concern that access to its top trade partner may be restricted the policies of U.S. President Donald Trump, who has pledged to protect U.S. jobs from going outside the country.

China and Mexico have been strengthening ties since late last year as the United States has stepped back from global trade agreements such as the Trans-Pacific Partnership (TPP).

Trump previously also threatened to ditch the North American Free Trade Agreement (NAFTA) between Mexico, United States and Canada, raising pressure on Mexico to reduce dependency on the United States, where it sends 80 percent of its goods exports.

The Trump administration has recently become more conciliatory, and Mexico and the United States have expressed confidence that the renegotiation of NAFTA, expected to begin in August, could benefit both nations.

Qiu’s comments are nonetheless a potential boost for President Enrique Pena Nieto, whose attitude towards China has been mixed – leading to an off-and-on trade relationship.

“I think any agreement to make trade easier is very worthy,” Qiu told the media after a speech at the National Autonomous University of Mexico to mark the 20th anniversary of Hong Kong’s return to China.