Favoured food

Mexico promotes cheap food imports and privatizes health checks to reduce inflation and tax, what could go wrong?

The Government of Mexico suspended import duties on pork, beef, and poultry last May, as part of President Andrés Manuel López Obrador’s programme to control rising inflation in the country. Five months later, the government passed a decree complementing this measure, by leaving food health checks to the private companies, arguing that it will reduce taxes and, thus, ease meat distribution and trade processes.

Rogelio Ramírez, Minister of the Treasury, said that the government will hand a ‘exclusive universal licence’ to these companies that will reduce the basic food basket price by 8%. However, the decision, described as a goodwill measure by the government, has sparked a widespread debate on the health risks that it can have on consumers. Ganaderos de Jalisco, a regional breeders association, said that the universal licence could lead to laxer controls which could re-introduce already eradicated veterinarian plagues in Mexico.

An executive at a Mexican producer thought the plan would distort the Mexican market, “The aim is to complement national production with cheap imports. The reality is that this will create unfair competition where imported products, being exempt from tariffs and sanitary requirements, will be cheaper than local products that have to comply with all the regulations.”

“The aim is to complement national production with cheap imports. The reality is that this will create unfair competition.”

Executive, food producer, Mexico

A Mexican food marketeer was surprised that the government does not appear to learn from previous mistakes, “There is already an issue of importing Chinese fish to the detriment of Mexican fish and seafood that are higher quality and have lower transport costs. For example, Mexico has an abundance of sardines and sardine farmers have been trying for years to encourage greater consumption of sardines, now, Mexico is going to start importing them! It is a paradox that President AMLO, who wants to defend Mexican food sovereignty, is giving a free hand to foreign products. Of course, it is necessary for products that the local market cannot supply, but his list of target products is very strange.”

President AMLO said that the decree will limit the role of the health government agencies SENASICA and Cofepris which, he claimed, were being used as an obstacle by private actors to benefit Mexico’s largest meat producers. The 15 companies granted the universal licence are Tuny, Grupo Pinsa-Dolores, Grupo Gruma-Maseca, Grupo Minsa, Bachoco, San Juan, Sukarne, Grupo Gusi, Opormex, Sigma Alimentos, Walmart, Soriana, Cedraui, Calvario and Valle Verde.

“It is impossible that the work of an agency such as SENASICA can be replaced by meat companies that do not have laboratories or specialised personnel,” explained a member of the National Agricultural Council in Mexico, “it is also a risk for the companies themselves, will they be held responsible for any public health problems that arise?”

“It is impossible that the work of an agency such as SENASICA can be replaced by meat companies that do not have laboratories or specialised personnel.”

Member, National Agricultural Council, Mexico

The government affirmed that both consumers, with lower prices at a time of global rising inflation, and producers, which will benefit from lower tariffs and increasing competitiveness will be the main winners of the measures. The same groups face serious risks in case of an animal disease outbreak which could have an impact on consumers health and Mexican exports abroad. In addition, the main challenge for the government will be to ensure rigorous health tests as the decree does not foresee the imposition of coercive measures for universal licence holders.

An agricultural scientist was concerned about the health risks, “Diseases ranging from cholera to other serious illnesses could be introduced, there could be a health risk for livestock and poultry farms if something like bird flu were to be introduced, and risks for crops if a pest were to be introduced.”

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