US commerce secretary’s resistance to cutting tariffs has stalled trade talks with Mexico

U.S. Commerce Secretary Howard Lutnick's opposition to reducing tariffs has impeded trade negotiations between the United States and Mexico, according to a report by The Wall Street Journal. The Journal cited sources familiar with the discussions, stating that the impasse stems from disagreements over the U.S. tariffs imposed on vehicles, steel, and aluminum coming from Mexico.

U.S. Trade Representative Jaime Escarcega has been overseeing the negotiations alongside Mexican Economy Minister Marcelo Ebrard, but tension exists between Greer and Lutnick, who challenged proposed tariff cuts in favor of national security concerns. These tariffs, implemented by Lutnick's department, are believed to be driven by domestic industry pressure warning of potential job losses and business harm if tariffs are reduced.

The Journal traced Lutnick's resistance back to pressure from U.S. industries. This is the second time Lutnick has disrupted advanced negotiations with a North American partner, previously with Canada. Despite this, both nations appeared close to finalizing a deal to lower tariffs in exchange for concessions from Mexico, including a suspension of a 10% tariff on vehicle parts and components.

This deal would have facilitated further discussions on renewing the U.S.-Mexico-Canada Agreement. Mexican officials and various business leaders remained optimistic about an imminent agreement. Both countries have denied that the bilateral talks had stalled, with Mexican Economy Minister Marcelo Ebrard highlighting Mexico's advantageous position in accessing the U.S. market during a recent meeting.