President López Obrador rejected on Tuesday a United States proposal to insert an addendum to the new North American trade agreement that would give it the power to oversee Mexican businesses to ensure compliance with new labor laws.

“They’re suggesting that there could be a kind of supervision over law compliance. We don’t accept that,” López Obrador told reporters at his morning press conference.

However, the government is open to the establishment of panels with representatives from Mexico and the United States that would review labor disputes, he said.

The president also said that the Mexican Senate should have the opportunity to review any changes to the United States-Mexico-Canada Agreement (USMCA) before it is ratified by the legislatures of those countries.

Mexico has already approved the new free trade pact, which will replace the 25-year-old NAFTA.

Ratification in the United States Congress has been held up by Democratic party lawmakers who are seeking stricter enforcement of new labor laws in Mexico.

The lawmakers have come under pressure from United States unions to ensure that Mexico doesn’t renege on commitments to strengthen the rights of organized labor. The U.S. unions want to set conditions for workers south of the border that make it harder for companies to move production to lower-cost Mexico, the news agency Reuters said.

The Mexican Congress approved earlier this year a landmark labor reform package that was considered crucial for the ratification of the USMCA in the United States.

Among other measures, the reform democratizes unions by giving workers the right to elect their leaders in free and secret ballots, and unions will be empowered to bargain more effectively on behalf of their members.

López Obrador’s rejection of the inclusion of a labor inspection measure in the USMCA came a day after the Business Coordinating Council (CCE) said in a statement that the United States had made “extreme demands” on labor issues that are “completely unacceptable.”

Without specifying the demands to which it was referring, the influential business group said they could “severely affect the competitiveness of Mexico and its North American partners.”

It also said that U.S. proposals could affect regional supply chains that were established 25 years ago.

“In case they come to fruition, the losers will be the people of Mexico, the United States and Canada, the region’s economy and cooperation between the three countries,” the CCE said.

“. . . The Mexican government will have our support to generate counter-proposals and maintain a firm position in defense of the competitiveness of our country . . .”

Source: Reuters (sp), El Financiero (sp)