Did someone say Mexico?

Friday was Mexico day for the Global Trade team at the CBI, which you may already have seen if you follow our Twitter account (@cbi_int).

We started the day with a member roundtable chaired by Lord Bilimoria. The CBI hosted a delegation from Mexico, including the Secretary of Economy, Tatiana Clouthier, the Undersecretary of Foreign Trade, Luz María de la Mora, and the Ambassador of Mexico to the UK, Josefa González-Blanco.

We then dashed across London to Diageo’s new HQ to be at the official launch of the negotiations. Both Secretary of State for International Trade Anne-Marie Trevelyan and Secretary of Economy of Mexico Tatiana Clouthier reinforced the importance of this new deal and announced the first round of negotiations in July in Mexico.

So what does this mean for business – I thought we already had an agreement with Mexico?

The negotiations are for an upgraded and more ambitious free trade agreement with Mexico. After Brexit the UK agreed a continuity trade deal, a ‘rollover deal’, preventing high tariffs and other market access barriers. But this was always going to be a short-term measure and now there is a chance to create a trade deal that works for both economies now and in the future.

There are some serious opportunities for business, which those at our roundtable had an early chance to impress upon the Mexican delegation, including the importance of:

• Trade in Services, including green services
• Digitalisation of trade and innovation
• Supporting greater SME trade

Other areas of mutual benefit include tourism and two-way investment which can be facilitated through the trade deal. Mexico is also a major market for UK exporters, with its growing population, the demand for imports is set to grow by 35% by 2035. A large consumer market as well as a growing middle class will provide opportunities for goods and services exports.

There are huge benefits for businesses of all sizes, a point made at our roundtable, with a clear commitment from Mexico to promote the opportunities unlocked by a free trade agreement. This aim is whole heartedly supported by the CBI, who with the Department for International Trade will work to ensure our members, and the business community more widely, are able to access the benefits of the deal. Trade is key for prosperity and increasing productivity in every region and nation of the UK. 

What might be the sticking points?

The European Union has recently negotiated a new deal with Mexico, and procurement at state level was tricky to secure. Although potentially difficult this should also be an aim of the UK government, putting us at parity with the EU and ensuring businesses do not lose out compared to European peers.

Individual sectors may also face specific challenges and pinch points in this process, and please do flag those to us so we can raise them with DIT.

So, what’s next - what is the CBI doing?

We will continue to work with our counterparts in Mexico and have already had productive meetings with the Mexican business associations, including COMCE, on the key opportunities the agreement could provide as well as the challenges businesses in both countries face.

We will continue to champion the needs of our members throughout this process, as we do with all free trade negotiations, so please do keep talking to us, either directly or through your account manager as your insights are very valuable and the government are keen to get the input of business in this process.

For more information on anything in this article, our work with Mexico, or the Americas more broadly please get in touch with Helena Coe.