RETAILERS THINK RESOLUTION NEAR ON MEXICO IMPORT RULES

Byline: Joyce Barrett

WASHINGTON--Even without the leverage of congressional legislation, retailers were optimistic Tuesday that a resolution will be reached early next week on problems they've incurred with shipments at the Mexican border.
The anticipated resolution is the result of negotiations between Mexican SECOFI (Department of Commerce) secretary Herminio Blanco Mendoza and James E. Oesterreicher, J.C. Penney Co. chief executive officer. The talks took place after retailers prevailed in securing an amendment to congressional drafts of a $40 billion loan guarantee program for Mexico that prohibited the Mexican government from interfering in shipments from U.S. retailers to their Mexico outlets.
The Mexican government, objecting to a slew of amendments that were being added to the loan guarantee bill stumbling across Capitol Hill, contacted the retail industry last week in an attempt to eliminate the provisions it felt threatened their sovereignty.
In exchange for a promise from the U.S. retail industry that it would withdraw its provision from the bill, Blanco promised in a Monday telephone call with Oesterreicher to meet with retail officials about the problem in Mexico early next week, according to a J.C. Penney spokesman.
On Tuesday, the loan guarantee situation changed dramatically, when President Clinton came up with a package that will not need Congressional approval. Nevertheless, Tracy Mullin, president of the National Retail Federation, was optimistic that the negotiations would be successful early next week.
"We've been operating in good faith, and we expect the Mexican government has done so, too," she said. "Because this issue has been taken away from Congress won't change the relationship we have built with Mexico."
Penney's has been hard hit by the Mexican government's requirement that retailers shipping merchandise from the U.S. to Mexico outlets present original certificates of origin. The retailer took the lead in the certificate-of-origin problem after repeated delays of its shipments south forced a two-month delay in a planned March 15 opening of two Mexican stores in Monterrey and Leon.
Because much of the merchandise going to Mexico is imported into the U.S., and the certificates of origin are routinely taken by U.S. Customs, original certificates have not been available and the merchandise has been stopped at the border.
"We've made very good progress in communicating with the Mexican government and the U.S. government how strongly these concerns are felt by the industry, and we're likely to see some good come out of the discussions we've had," Mullin said.
--Fairchild News Service

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