(Bloomberg) -- President Joe Biden’s trade chief said Mexico’s sweeping judicial overhaul spurred questions for the US about its top trade partner and a need to understand the scope for collaboration with its new leader.
The business community’s concerns about the move to elect judges are helping guide Washington’s approach to President Claudia Sheinbaum’s two-week old administration, US Trade Representative Katherine Tai said in an interview.
Companies and the US ambassador to Mexico warn that the changes approved before Sheinbaum’s predecessor, Andrés Manuel López Obrador, left office erode checks on the ruling party’s power and risk undermining the rule of law.
“There are a lot of very, very consequential challenges between us,” Tai said Friday of the US and Mexico. “We are going to want to be able to look each other in the eye, to understand exactly where the Sheinbaum administration is, and understand what the parameters of our work together will look like.”
Tai — speaking during a visit to a Pennsylvania steel mill — added that she’s also listening to input from US unions and workers. Tai touted a labor tool that she was key to crafting in the 2020 US-Mexico-Canada Agreement, which pressures firms in Mexico to respect worker rights and has been used by the US dozens of times.
The state of the relationship will likely be a topic of discussion at the US-Mexico CEO Dialogue event that starts in Mexico City on Monday night. US Chamber of Commerce President Suzanne Clark and other top business representatives from Washington will speak with their Mexican counterparts and top trade, finance and energy officials from the new government, according to an agenda seen by Bloomberg News. Sheinbaum is set to speak on Tuesday morning.
López Obrador’s six-year term was characterized in part by a series of hostile actions against foreign companies and investors.
Tai said she’s looking forward to holding her first meeting with Mexican Economy Minister Marcelo Ebrard “soon.” Her office is thinking about how to position North America relative to the rest of the world, she said, while praising Mexico’s move to increase its tariffs on steel from non-free-trade partners — most importantly, China.
Tai said a required review of the USMCA by mid-2026 “is one of the most important things that lies ahead” for the US and its continental partners.
“There are ways that we can approach that that will be more constructive,” she said. “A lot of it will depend on how we establish our forward-going relationship.”
--With assistance from Alex Vasquez and Carolina Millan.
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