The border trucking dispute is hodgepodge of conflicting interests.

No matter how it turns out, the tedious flag-waving brouhaha over cross-border trucking access between Mexico and the United States will have its winners and losers. One can only hope that the affair's increasing politicization won't grow into something worse.

Mexican truck access has been blocked by the U.S. Congress since 1996--a tacit violation of Nafta terms, and so it was ruled by a Nafta panel in February this year, obligating the U.S. government to either back down or compensate. And that's not peanuts--trucking is the cornerstone of U.S.-Mexico trade logistics, with an estimated 80% of all goods crossing the border by road.

SAFETY FIRST?

Going by most mass-media reports, the matter is fairly straightforward: Americans don't want treacherous Mexican cargo trucks roaring down their highways. And no one seems more concerned about highway safety than the 1.4 million member-strong U.S. Teamsters, who have waged an all-out campaign against Mexican truck access.

As discussed previously in BUSINESS MEXICO, the Teamsters' opposition probably has less to do with highway safety than it does job protection. The average US$14 per hour earned by U.S. drivers is a world away from the average US$5 an hour made by their Mexican counterparts.

Likewise, safety concerns were probably not behind the U.S. Senate move on June 26 to block funding for truck inspections on the border--effectively preventing local truckers from complying with the safety requirements they would need in order to operate north of the border. And these, according to President of the U.S. Chamber of Commerce Thomas Donahue, are already highly discriminatory.

"Mexican motor carriers applying for U.S. permits will be required to provide far more detailed information regarding their ability to meet U.S. safety requirements than their American or Canadian counterparts," he recently told the U.S. House Committee on Transportation and Infrastructure.

Indeed, U.S. Transport Secretary Norman Mineta recently told press that "President Bush firmly believes that we can have safety on our highways without discriminating against our southern neighbors."

Harder to swallow, however, is the tough competition that local truckers would pose to many medium-sized U.S. trucking companies near the border. Furthermore, and given that local goods must currently be hauled onto U.S. trucks within 20 km of the border, an open-road policy would spell the demise of many companies specializing in freight transferals all along the border area.

At an estimated price of between US$50 and US$120 per freight--not to mention the cost in time and man-hours--this represents-a needless clot in Nafta's arteries. And that's probably why the Bush administration, ever the corporate ally, is supporting change.

THAT'S NOT ALL FOLKS

But if the U.S. does open up its roads as early as January next year, not everybody south of the border will be pleased to see it. The president of the nation's 4,000-member cargo trucking association (Conacar) Manuel Gomez, has publicly endorsed the status quo. Gomez believes an open border trucking policy would lead to local trucking companies closing down in Mexico and setting up in the United States because "everything's cheaper over there," he told local press.

Indeed, lower wages won't give local trucking companies a big edge against large U.S. truckers who are eager to operate down south. With better financial backing, and access to cheaper fuel and spare parts from the United States, these giants would probably merge with larger Mexican truckers for dominant market positions.

DON'T BELIEVE THE HYPE

According to Mexico's Economy Secretariat (SE), restricted border access to Mexican trucks has caused billions of dollars in losses to local firms. As push has come to shove, the complexities of this trade issue are becoming bogged down by nationalist sentiments. Despite compensation possibilities, the SE has already threatened retaliatory measures against U.S. imports.

But then, the government is looking at the wider picture. Open truck access would not only consolidate Mexico's position within the Nafta marketplace, but also heighten the advantages of the nation's proximity to North America. In the long-term, this would only boost investment appeal, while offsetting that of Asian competitors or other regional players that might join Nafta further down the road. Stay tuned.

Matthew Gower is BUSINESS MEXICO'S associate editor.