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U.S. Trade Complaint Against Mexico Puts López Obrador in a Corner

By Juan Montes and Yuka Hayashi

“The energy issue is central to the president’s agenda and conception of Mexico as a nation," said AS/COA's Eric Farnsworth to The Wall Street Journal.

The U.S. challenge to Mexico’s nationalist energy policies creates a dilemma for President Andrés Manuel López Obrador—one that could either force him to retreat from his populist agenda or face retaliatory tariffs from Mexico’s biggest export market.

The U.S. Trade Representative Office this week filed for dispute settlement consultations under the U.S.-Mexico-Canada Agreement on grounds that Mexico’s energy policies undermine U.S. firms in favor of state-run companies, in a case that has bipartisan support and the backing of the energy industry in the U.S. […]

State control of Mexico’s energy industry has been Mr. López Obrador’s rallying cry for years, arguing that the opening of the oil sector in 2013 was “the theft of the century” perpetrated by corrupt politicians.

“The energy issue is central to the president’s agenda and conception of Mexico as a nation. He is unlikely to acquiesce without a fight,” said Eric Farnsworth, vice president of Washington think tank Americas Society/Council of the Americas. […]

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