The Day at a Glance | May 10 2021

The Top

· *Labor Federation in the United States prepares first complaint against Mexican company for non-compliance regarding labor laws in the USMCA.

· *Gasoline prices increase in the US after infrastructure cyber-attack on pipelines; it`s feared that scarcity will occur in the eastern part of the country.

· *Economic indicators: Investor confidence grows in Europe (21 vs 13.1 prev.); inflationary data in China is expected to be made public (1% e. Apr.).

Economic environment

The AFL-CIO labor union is preparing a petition for the United States government to formally present a complaint in the USMCA. According to a report from Reuters, the largest labor union in the United States will present its government a petition to bring a labor complaint against a Mexican auto parts company in Matamoros, Mexico; the union considers that the USMCA has been breached. If this moves forward, this would be the first time that the settlement dispute mechanism in the agreement would be used. The AFL-CIO`s petition assures that workers in the Tridonex company in Matamoros were denied independent union representation, something that violates the international agreement. The petition will be closely followed since this could set precedents in the agreement`s settlement dispute system. Companies whose activities violate the agreements stipulations could be subject to tariffs and other type of penalizations. The AFL-CIO will send its petition to the US Office of Trade and Labor Affairs, which will have 30 days to look over the petition and decide whether or not a formal complaint against the Mexican government will be made. Thereafter, American and Mexican authorities would have to work together to find a solution. The controversy could be solved quickly since there is no reason to believe that there is no political willingness to resolve the issue; Biden and López Obrador have defended labor laws – setting them up above company interests.