President Donald Trump isn’t on the best terms with Mexico, after all, they are angry at the fact that he is going to force them to pay for his border wall.
Despite this, the United States and Mexico managed to agree on a sugar deal that will benefit both countries.
Still, for some small businesses, they fear that the deal will cause their bottom line to increase.
Conservative Tribune reports:
Nonetheless, the agreement has been called a significant hurdle cleared by the two countries ahead of more complex discussions regarding the North American Free Trade Agreement between the United States, Mexico and Canada, which are expected to start in August.
The new agreement would reportedly reduce the share of refined sugar that Mexico can send to the U.S. to 30 percent of total sugar sent, however U.S. sugar producers said the pact contained a “loophole” that they predicted would allow Mexico to dump more sugar on the U.S. market, or fail to provide raw sugar to refineries, according to Fox Business.
Phillip Hayes, spokesman for the American Sugar Alliance, indicated that he was concerned about the potentially problematic loophole, but was willing to work with the government to find a solution.
Rick Pasco, head of Sweetener Users Association, was less optimistic, saying that the deal would raise the floor price for raw sugar, which would inevitable hurt cereal, beverage and candy makers.
According to Pasco, sugar prices in the U.S. are already 80 percent higher than the rest of the world and he suggested that the new deal would cause it to balloon to 100 percent.
“If you’re a food company looking at long-term investment in the U.S. and you’re paying twice the world price, that’s got to be a consideration going forward,” Pasco said, noting that roughly 600,000 U.S. jobs depend on sugar-using companies.
Kirk Vashaw, CEO of the Ohio-based Sprangler Candy Co., says he is very disappointed with the deal and the Trump administration in general.
“To be honest, I’m just very disappointed that the Trump administration didn’t do more to level the playing field, which is something they promised over and over again to do for the American worker,” Vashaw told Reuters.
The U.S. government has defended its decision to sign the deal, citing the fact that Mexico was unfairly selling its sugar at cheaper prices to try and drive down the prices of its competition and the fact that Mexico was threatening retaliatory tariffs against the U.S.
What do you think about this deal? Did the U.S. government do the right thing?
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