Trade deals are no longer just signed, printed, and then put on the shelf to gather dust. They are increasingly being renegotiated, revised, and updated as conditions and contexts between countries change and new issues arise.
At an Economic Summit in Mexico City on May 22, the European Union and Mexico signed a modernized Global Agreement (MGA) and an interim Trade Agreement (iTA) that the two partners had been negotiating since May 2016. Once ratified by the EU Parliament and the member states, these agreements will update and replace the EU–Mexico Economic Partnership, Political Coordination and Cooperation Agreement (the Global Agreement) that has been in effect since 2000.
Although reducing trade barriers is at the heart of the updated Global Agreement, the revised agreement recognizes the significant changes in global trade and investment over the past 25 years, and the new agreements both the EU and Mexico have signed with third-party nations. The new Global Agreement covers a wide range of issues important to both parties that were not addressed in the 1990s: environmental protection, sustainable development, digital transition, labor rights, gender equality, and equal access for Small and Medium Enterprises (SMEs).
In addition, it creates a new Investment Court System to mediate disputes — something the EU has incorporated into more recent agreements with Canada, Singapore, Vietnam, and Chile. The new Global Agreement also seeks to strengthen and sustain supply chains, particularly of materials critical to the green and digital transitions, and — most importantly — to hedge against the protectionism and unpredictability of the United States, the most important trading partner for both Mexico and the EU.
Proponents of rules-based free trade are recognizing that in a turbulent world economy threatened by protectionism, even stable long-term trade relationships need active maintenance and revision. One-and-done is over.