APEC: NON TARIFF BARRIERS TO MEXICAN EXPORTS

APEC: NON TARIFF BARRIERS TO MEXICAN EXPORTS

Clemente Ruiz Durán.Clemente Ruiz Durán.Universidad Nacional Autónoma de MéxicoFacultad de Economía

México export boom 1990 to 2004México export boom 1990 to 2004

Graph 1. Mexico export boom 1990 to 2004

0

20,000,000

40,000,000

60,000,000

80,000,000

100,000,000

120,000,000

140,000,000

160,000,000

180,000,000

200,000,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Exp

ort

s in

thousa

nd d

olla

rs

Total

US

Mexico has become one of the leading export countries of the world, in 2004 exports reached almost 190 billion dollars, from a low of 23 billion in 1990. Most of the exports go to United States and Canada (89 percent of total) and only 2 percent to other Pacific Rim countries. Imports are more diversified US and Canada share is of 60 percent, and other Pacific Rim countries share is of 20 percent. Mexico Pacific Rim balance is positive (14 billion) due to the large surplus that Mexico holds with US, that in 2004 reached 54 billion dollars.

Mexican exports the basis of structural change

Mexican exports the basis of structural change

Year Total Oil Non Oil Agriculture Mining Manufacturing1990 100.0 37.6 62.4 8.1 2.3 52.01991 100.0 19.1 80.9 5.6 1.3 74.01992 100.0 18.0 82.0 4.6 0.8 76.71993 100.0 14.8 85.2 5.4 0.6 79.21994 100.0 12.5 87.5 5.0 0.6 81.81995 100.0 10.9 89.1 5.8 0.6 82.71996 100.0 12.3 87.7 4.3 0.4 82.91997 100.0 10.4 89.6 4.0 0.4 85.21998 100.0 6.2 93.8 3.7 0.4 89.71999 100.0 7.3 92.7 3.3 0.3 89.12000 100.0 9.7 90.3 2.9 0.3 87.12001 100.0 8.3 91.7 2.8 0.2 88.62002 100.0 9.2 90.8 2.6 0.2 87.92003 100.0 11.3 88.7 3.1 0.3 85.42004 100.0 12.6 87.4 3.0 0.5 83.9

Table 1. Exports structural change (% of total)

Source: INEGI BIE Exportaciones por tipo de bienes. November 17, 2005

One of the main features of structural change in Mexico has been the dramatic restructuring of export composition, where oil was the main export good in the eighties, there was a continuous drop of its share in the nineties, while manufacturing goods emerged as the main exporting force.

Main Manufacturing exportsMain Manufacturing exports

Year TotalLand vehiclesand

its partsElectric machinery

and materialsGarment

Most dynamic export items

Chapter 87 Chapter 85Chapter 61,62,63

1993 100.0 13.6 26.6 2.7 42.91994 100.0 13.8 27.7 3.1 44.71995 100.0 15.4 25.5 3.6 44.51996 100.0 17.2 24.9 4.2 46.31997 100.0 16.1 25.6 5.5 47.21998 100.0 16.6 27.2 6.2 50.01999 100.0 17.2 27.9 6.2 51.42000 100.0 17.0 28.6 5.6 51.22001 100.0 17.6 27.3 5.4 50.22002 100.0 17.3 26.3 5.3 48.92003 100.0 16.6 24.8 4.9 46.22004 100.0 15.2 24.7 4.3 44.22005 100.0 14.2 23.9 4.0 42.1

Source: INEGI BIE Indicadores del Sector Externo Noviembre 2005

Table 2. Mexico: main export goods (% of total)

Mexico trade by regions Mexico trade by regions Year Total

North America (US and Canada)

Pacific Rim without North

AmericaALADI European Union

1990 100% 70.5% 6.5% 3.3% 13.2%1991 100% 82.2% 3.6% 2.3% 7.8%1992 100% 83.3% 2.6% 2.9% 7.4%1993 100% 86.1% 2.3% 3.1% 5.1%1994 100% 87.7% 2.5% 2.6% 4.5%1995 100% 86.1% 2.8% 3.6% 4.3%1996 100% 86.3% 3.0% 3.6% 3.7%1997 100% 87.6% 2.7% 3.4% 3.6%1998 100% 89.1% 2.2% 2.5% 3.3%1999 100% 90.0% 1.7% 1.6% 3.9%2000 100% 90.9% 1.4% 1.7% 3.4%2001 100% 90.6% 1.4% 1.9% 3.4%2002 100% 90.1% 1.9% 1.9% 3.4%2003 100% 89.6% 2.1% 1.8% 3.7%2004 100% 89.4% 2.0% 2.2% 3.6%

Year TotalNorth America

(US and Canada)

Pacific Rim without North

AmericaALADI European Union

1990 100% 67.1% 6.9% 4.1% 16.6%1991 100% 75.1% 5.0% 3.2% 12.4%1992 100% 73.0% 6.7% 3.3% 12.3%1993 100% 73.0% 7.6% 3.3% 11.8%1994 100% 73.9% 7.4% 3.2% 11.3%1995 100% 76.4% 8.2% 2.4% 9.3%1996 100% 77.5% 7.5% 2.2% 8.6%1997 100% 76.6% 7.5% 2.1% 9.0%1998 100% 76.3% 7.5% 2.0% 9.3%1999 100% 76.4% 7.7% 2.0% 9.0%2000 100% 75.6% 10.4% 2.3% 8.6%2001 100% 70.2% 13.4% 2.8% 9.7%2002 100% 66.0% 16.1% 3.2% 9.9%2003 100% 64.4% 17.3% 3.8% 10.6%2004 100% 59.2% 20.8% 4.6% 10.6%

Exports as % of total

Source:INEGI, BIE, Balanza Comercial por zonas geoeconómicas y principales países Noviembre 2005.

Exports as % of total

Source:INEGI, BIE, Balanza Comercial por zonas geoeconómicas y principales países Noviembre 2005.

Mexico trade balance by region Mexico trade balance by region

Year TotalNorth America

(US and Canada)

Pacific Rim without North

AmericaALADI European Union

1990 -4434.00 -2065.00 -428.00 -399.00 -1651.001991 -7279.00 -2460.00 -935.00 -592.00 -2857.001992 -15933.00 -6862.00 -3011.00 -672.00 -4253.001993 -13481.00 -3047.00 -3776.00 -569.00 -5043.001994 -18464.00 -5196.00 -4319.00 -969.00 -6204.001995 7089.00 13086.00 -3657.00 1094.00 -3342.001996 6531.00 13470.00 -3840.00 1494.00 -4179.001997 623.00 12538.00 -5315.00 1465.00 -5881.001998 -7834.00 9008.00 -6868.00 431.00 -7799.001999 -5613.00 14366.00 -8521.00 -662.00 -7410.002000 -8337.00 19119.00 -15848.00 -1214.00 -9440.002001 -9616.00 25539.00 -20294.00 -1716.00 -10963.002002 -7633.00 33757.00 -24147.00 -2434.00 -11100.002003 -5780.00 37755.00 -26090.00 -3610.00 -11884.002004 -8811.00 51499.00 -37125.00 -4812.00 -14202.00

Balance (millions of dollars)

Source:INEGI, BIE, Balanza Comercial por zonas geoeconómicas y principales países Noviembre 2005.

Non-Tariff Barriers That Mexico Faces in the Pacific Rim Non-Tariff Barriers That Mexico Faces in the Pacific Rim

Share of total Xs (%)

Mexican Exports subject to NTM

Share ot total Xs subject to NTM

(%)

Share of Xs subject to NTM to total

exports (%)

Number of non tariff barriers

187,998.60 100 111171,856.60 91.41 8,234.20 100 4.8

1 US 164,798.70 87.66 8,047.10 97.728 4.9 182 Canada 3,291.50 1.75 4.2 0.051 0.1 53 Japan 1,190.50 0.63 96.1 1.168 8.1 234 China 986.3 0.52 17.8 0.217 1.8 105 Chile 442.9 0.24 26.8 0.325 6 106 Singapore 312 0.17 2.7 0.033 0.9 57 Australia 274.7 0.15 1 0.012 0.4 38 South Korea 219 0.12 21.4 0.26 9.8 89 Hong Kong 173.5 0.09 9.3 0.113 5.3 310 Malaysia 57.4 0.03 1.3 0.015 2.2 611 Thailand 51.2 0.03 0.9 0.011 1.8 312 Russia 25.8 0.01 4 0.048 15.4 713 Philippines 17.8 0.01 1.5 0.019 8.6 614 New Zeland 15.4 0.01 0.1 0.002 0.9 4

Source: INEGI: BIE Indicadores del Sector Externo Noviembre 2005; Bancomext Sistema de Información de Comercio Exterior; Table 5.

Mexican Exports subject to NTM in the Pacific Rim Countries

Million of dollars

Total Mexican ExportsPacific Rim Exports

US Non-Tariff Barriers to Mexico ExportsUS Non-Tariff Barriers to Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agencyOil seed, oleagi fruits;miscell grain, seed,fruit etc 12 61,547,539.00 0.037

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Prep of meat, fish orcrustaceans, molluscsetc 16 88,325,692.00 0.053

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Sugars and sugarconfectionery. 17 308,545,792.00 0.184

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Beverages, spirits andvinegar. 22 1,769,719,427.00 1.057

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Tobacco andmanufactured tobaccosubstitutes. 24 25,182,198.00 0.015

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Salt; sulphur; earth &ston; plastering mat;lime & cem 25 268,231,467.00 0.16

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Organic chemicals. 29 447,270,167.00 0.267

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Pharmaceutical products. 30 183,457,730.00 0.11

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Raw hides and skins(other than furskins)and leather. 41 174,433,636.00 0.104

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Wood and articles ofwood; wood charcoal. 44 374,150,620.00 0.223

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Source: INEGI; BANCOMEXT; Trade Wizard

U S

US Non-Tariff Barriers for Mexico ExportsUS Non-Tariff Barriers for Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agency167,454,948,168 100

8,047,121,266 4.8055

Live animals. 1 565,167,392.00 0.338

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Meat and edible meatoffal. 2 212,223,183.00 0.127

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Fish & crustacean,mollusc & otheraquatic invertebrate 3 457,489,394.00 0.273

Licenses and Permits,Requirements sanitary andphytosanitary. Fish and WildlifeServices.

Dairy prod; birds' eggs;natural honey; edibleprod nes 4 34,917,555.00 0.021

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Live tree & other plant;bulb, root; cut flowersetc 6 34,110,064.00 0.02

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Edible vegetables andcertain roots andtubers. 7 2,901,362,227.00 1.733

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Coffee, tea, matû andspices. 9 137,437,194.00 0.082

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

Cereals. 10 3,549,989.00 0.002

Licenses and Permits,Requirements sanitary andphytosanitary.

Animal and Plant HealthInspection Service.

TOTAL Exports subject to NTM

U S

Chile Non-Tariff Barriers to Mexico Exports Chile Non-Tariff Barriers to Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agency555,374,649 10026,778,624 4.8217

Meat and edible meat offal.

2 82,444.00 0.0148

Licenses and Permits, Requirements sanitary and

phytosanitary.

Ministry of Health . Inspecciones. Agriculture

and Livestock ServiceDairy prod; birds' eggs; natural honey; edible prod nes 4 40,559.00 0.0073

Licenses and Permits, Requirements sanitary and

phytosanitary.

Ministry of Health . Inspecciones. Agriculture

and Livestock ServiceEdible fruit and nuts; peel of citrus fruit or melons. 8 2,544,419.00 0.4581

Licenses and Permits, Requirements sanitary and

phytosanitary.

Agriculture and Livestock Service.

Coffee, tea, matû and spices.

9 948,417.00 0.1708

Licenses and Permits, Requirements sanitary and

phytosanitary.

Agriculture and Livestock Service.

Cereals.10 35,033.00 0.0063

Licenses and Permits, Requirements sanitary and

phytosanitary.

Agriculture and Livestock Service.

Cocoa and cocoa preparations.

18 268,381.00 0.0483

Licenses and Permits, Requirements sanitary and

phytosanitary.

Agriculture and Livestock Service.

Prep of cereal, flour, starch/milk; pastrycooks' prod 19 2,432,775.00 0.438

Licenses and Permits, Requirements sanitary and

phytosanitary.

Public Health Care Service.

Miscellaneous edible preparations.

21 3,479,090.00 0.6264

Licenses and Permits, Requirements sanitary and

phytosanitary.

Public Health Care Service.

Beverages, spirits and vinegar.

22 3,415,013.00 0.6149

Licenses and Permits, Requirements sanitary and

phytosanitary.

Public Health Care Service. Inspecciones.

Agriculture and Livestock Service.

Pharmaceutical products.

30 13,532,493.00 2.4366

Licenses and Permits, Requirements sanitary and

phytosanitary.

Public Health Care Service. Inspecciones.

Agriculture and Livestock Service.

Chile

TOTAL Exports subject to NTM

Source: INEGI; BANCOMEXT; Trade Wizard

China Non-Tariff Barriers for Mexico Exports China Non-Tariff Barriers for Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agency474,158,751 10017,830,611 3.7605

Live animals. 1 20,000.00 0.004

Licenses and Permits, Requirements sanitary and

phytosanitary.

General Administration of Quality Supervision,

Inspection and Quarantine

Meat and edible meat offal. 2 103,897.00 0.022

Licenses and Permits, Requirements sanitary and

phytosanitary.

General Administration of Quality Supervision,

Inspection and Quarantine

Fish & crustacean, mollusc & other

aquatic invertebrate 3 6,202,473.00 1.308

Licenses and Permits, Requirements sanitary and

phytosanitary.

General Administration of Quality Supervision,

Inspection and Quarantine

Live tree & other plant; bulb, root; cut flowers

etc 6 40,640.00 0.009

Licenses and Permits, Requirements sanitary and

phytosanitary.

General Administration of Quality Supervision,

Inspection and Quarantine

Edible vegetables and certain roots and

tubers. 7 18,180.00 0.004

Licenses and Permits, Requirements sanitary and

phytosanitary.

General Administration of Quality Supervision,

Inspection and Quarantine

Prod mill indust; malt; starches; inulin; wheat

gluten 11 0 0

Licenses and Permits, Requirements sanitary and

phytosanitary.

General Administration of Quality Supervision,

Inspection and Quarantine

Raw hides and skins (other than furskins)

and leather. 41 11,445,421.00 2.414

Licenses and Permits, Requirements sanitary and

phytosanitary.

Endangered Species Import and Export

Management Office of the State Forestry Administration

Manufactures of straw, esparto/other plaiting

mat; etc 46 0 0

Licenses and Permits, Requirements sanitary and

phytosanitary.

General Administration of Quality Supervision,

Inspection and QuarantineSource: INEGI; BANCOMEXT; Trade

TOTAL Exports subject to NTM

China

Phillippines Non-Tariff Barriers to Mexico ExportsPhillippines Non-Tariff Barriers to Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agency12,746,254 1001,535,321 12.045

Live animals. 1 25 0.0002 Licenses and PermitsProtected Áreas andWildlife Bureau.

Dairy prod; birds' eggs;natural honey; edibleprod nes 4 491,271.00 3.8542 Prohibition

Bureau of Customs,Department of Finance.

Animal/veg fats & oils& their cleavageproducts; etc 15 313 0.0025 Prohibition

Bureau of Customs,Department of Finance.

Sugars and sugarconfectionery. 17 1,043,712.00 8.1884 Prohibition

Bureau of Customs,Department of Finance.

TOTAL Exports subject to NTM

Table 24. Philippines

Source: INEGI; BANCOMEXT; Trade Wizard

Singapore Non-Tariff Barriers to Mexico ExportsSingapore Non-Tariff Barriers to Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agency264,270,168 1002,701,977 1.0224

Fish & crustacean,mollusc & otheraquatic invertebrate 3 728,854.00 0.2758

Licenses and Permits,Requirements sanitary andphytosanitary.

Agri-food and VeterinaryAuthority, Food andVeterinary Administration,Import and ExportDivision.

Products of animalorigin, nes or included. 5 5,802.00 0.0022

Licenses and Permits,Requirements sanitary andphytosanitary.

Agri-food and VeterinaryAuthority, Food andVeterinary Administration,Import and ExportDivision.

Edible vegetables andcertain roots andtubers. 7 1,908,154.00 0.722

Licenses and Permits,Requirements sanitary andphytosanitary.

Agri-food and VeterinaryAuthority, Food andVeterinary Administration,Import and ExportDivision.

Cocoa and cocoapreparations. 18 53,297.00 0.0202

Licenses and Permits,Requirements sanitary andphytosanitary.

Agri-food and VeterinaryAuthority, Food andVeterinary Administration,Import and ExportDivision.

Raw hides and skins(other than furskins)and leather. 41 5,870.00 0.0022

Licenses and Permits,Requirements sanitary andphytosanitary.

Agri-food and VeterinaryAuthority, Food andVeterinary Administration,Import and ExportDivision.

TOTAL Exports subject to NTM

Singapore

Source: INEGI; BANCOMEXT; Trade Wizard

South Korea Non-Tariff Barriers to Mexico Exports South Korea Non-Tariff Barriers to Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agency111,006,227 10021,371,393 19.252

Meat and edible meatoffal. 2 2,864,748.00 2.581

Licenses and Permits forthe importation,mechanisms of specialsecurity, requirementssanitary and phytosanitary.

National VeterinaryResearch and QuarantineService.

Fish & crustacean,mollusc & otheraquatic invertebrate 3 1,766,882.00 1.592

Licenses and Permits,Requirements sanitary andphytosanitary.

National FisheriesResearch andDevelopment Institute.

Dairy prod; birds' eggs;natural honey; edibleprod nes 4 111,441.00 0.1

Licenses and Permits,Requirements sanitary andphytosanitary.

Korea EnvironmentCorporation.

Products of animalorigin, nes or included. 5 222,704.00 0.201

Licenses and Permits,Requirements sanitary andphytosanitary.

Korea EnvironmentCorporation. NationalVeterinary Research andQuarantine Service.

Edible vegetables andcertain roots andtubers. 7 10,039.00 0.009

Licenses and Permits,Requirements sanitary andphytosanitary.

Korea Food and DrugAdministration, NationalQuarantine Station.

Coffee, tea, matû andspices. 9 1,933.00 0.002

Licenses and Permits,Requirements sanitary andphytosanitary.

Korea Food and DrugAdministration, NationalQuarantine Station.

Organic chemicals. 29 16,393,646.00 14.768 Licenses and Permits.Korea PharmaceuticalTraders Association.

TOTAL Exports subject to NTM

South Korea

Source: INEGI; BANCOMEXT; Trade Wizard

Thailand Non-Tariff Barriers To Mexico ExportsThailand Non-Tariff Barriers To Mexico Exports

ChapterMillions of US

dollars % NTM restriction Supervisory agency25,275,400 100

916,583 3.6264

Sugars and sugarconfectionery. 17 39,814.00 0.1575

Licenses and Permits,Requirements sanitary andphytosanitary.

Food Control Division ofthe Food and DrugAdministration.

Beverages, spirits andvinegar. 22 485,425.00 1.9205

Licenses and Permits,Requirements sanitary andphytosanitary.

Food and DrugAdministration.

Raw hides and skins(other than furskins)and leather. 41 391,344.00 1.5483

Licenses and Permits,Requirements sanitary andphytosanitary.

Ministry of Agriculture andCooperatives.

TOTAL Exports subject to NTM

Thailand

Source: INEGI; BANCOMEXT; Trade Wizard

Findings Findings

Sanitary and phyto sanitary are the main non tariff barriers for Mexican exports

Chemicals are the second area where Mexico faces non tariff barriers in the Pacific Rim

Mexico has to work out non tariff barriers within the FT reached with US, Japan, and Chile

There is no approach to deal with non tariff barriers by Mexican Government

Sanitary and phyto sanitary are the main non tariff barriers for Mexican exports

Chemicals are the second area where Mexico faces non tariff barriers in the Pacific Rim

Mexico has to work out non tariff barriers within the FT reached with US, Japan, and Chile

There is no approach to deal with non tariff barriers by Mexican Government