Mexico and Canada leaders talk investment, energy dispute

Mexico’s president has lauded investments from Canada and says he will meet with Canadian companies that may have a problem with his energy policies

Mexico’s president lauded investments from Canada and said he would meet with Canadian companies that might have a problem with his energy policies.

President Andrés Manuel López Obrador commented after meeting privately with his Canadian counterpart, Prime Minister Justin Trudeau. Their session came on the heels of the North American Leaders’ Summit a day earlier in which U.S. President Joe Biden also participated.

The United States and Canada accuse López Obrador of trying to favor Mexico’s state-owned utility over power plants built by foreign and private investors, something that is forbidden under the three countries’ free trade pact.

López Obrador said he and Trudeau discussed economic issues, investments by Canadian mining companies and the energy infrastructure company TC Energy, also known as TransCanada. The president said that company was making a very important investment in a pipeline that would bring natural gas to southeastern Mexico.

Mexico has been trying to lure foreign investment to its south from the northern frontier region, where it clusters for easy access to the United States.

López Obrador's largest effort in that regard is an envisioned shipping corridor connecting ports on the Pacific and Gulf of Mexico that crosses Mexico’s narrow isthmus. The government wants to build a string of industrial parks, but it has been hindered by the lack of a natural gas supply.

The pipeline the president mentioned Wednesday, which was announced in August, would bring gas to the northern end of that corridor. The $4.5 billion Southeast Gateway Pipeline would run some 444 miles (715 kilometers) from fields offshore of Veracruz and Tabasco states.

On the more contentious issue of electricty, López Obrador said he told Trudeau that he would meet with Canadian companies that have complaints with his administration’s policies.

The U.S. government objects to an electrical power overhaul that seeks to limit foreign-built renewable energy plants in Mexico and grant a majority market share to the state-owned power utility. The U.S.-Mexico-Canada free trade agreement, known as USMCA, prohibits favoring domestic companies over those from other member states.

The U.S. initially requested talks in July, but they have so far not yielded any solution. The United States could demand an arbitration panel, and the dispute could end in trade sanctions against Mexico.

Asked if there were advances on those disputes during the North American Leaders’ Summit, U.S. Ambassador to Mexico Ken Salazar said Wednesday that the commercial disputes between the three countries were being addressed through the normal channels of the USMCA.

“That’s why (USMCA) was created,” Salazar said. “When there are differences, there is the path where it has to be resolved.”

Trudeau steered clear of controversy in his public remarks.

“We are both progressive countries that put forward equality, justice, opportunity for all, jobs for the middle class, and for people working hard to join it, protection of the environment, support for indigenous peoples, at the center of our vision for each of our countries,” Trudeau said. “And that puts it at the center of our vision for a more prosperous North America as well.”