While the ratification of the USMCA trade agreement is still uncertain in the United States Congress, transnational companies in Mexico, such as Kansas City Southern, warn that they will not start new projects until a resolution is clear.
During The Economist Mexico 2019 forum, Patrick Ottensmeyer, president and CEO of the railway company, explained that at the moment they are waiting for new opportunities and are only moving forward with the projects they already have.
The executive clarified that while the trilateral agreement may help increase investment in the country, it is not enough. "Once the treaty is approved, one of the sources of uncertainty for investors is removed, but there are others," he said, referring to both Mexico and the U.S.
He said that in the case of the United States the issue "is the lack of clarity in trade rules, such as migration tariffs." As for Mexico, he indicated that there were concerns around some of the actions taken by the AMLO administration, "such as the cancellation of the airport project or changes in pipeline contracts," he said.
Although he also recognized that Mexico does have a great opportunity to attract new investment. "Companies are losing interest in China for different reasons, not just because of the bad relationship with the United States."
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