What's in NAFTA Talks for Canadian Businesses

Marsha Scott
August 17, 2017

Canada, the United States and Mexico are taking the first step toward negotiating changes to the North American Free Trade Agreement (NAFTA).

Chris Wilson with the Wilson Center a non-partisan policy center, said millions of American jobs now depend on trade with Canada and Mexico.

"Many Americans have benefited from NAFTA", Lighthizer said in his opening comments.

Mr Trump has maintained his rhetoric against Nafta, blaming it for the country's large trade deficit with Mexico, and suggesting U.S. manufacturing jobs have been lost across the border.

And he says the components cross back into the US or Canada and back to the USA or Mexico again before finally being part of a finished vehicle. A trade agreement might modestly improve the lives of many Americans (think lower prices or a greater assortment of goods), but it can also devastate a much smaller population of Americans by displacing their jobs.

A Morning Consult survey conducted in June found 35 percent of registered US voters said NAFTA has a mostly positive impact, while 28 percent said it has a mostly negative effect. "We highly encourage (negotiators) to get it done and get it done fast", he said of NAFTA.

Canada's Foreign Minister and lead NAFTA negotiator, Chrystia Freeland, took a swipe at the US position on the need to shrink the USA trade deficit.

Ron Bonnett, president of the Canadian Federation of Agriculture, said the recognition of agriculture's positive benefits under the current NAFTA "very much signaled that agriculture was a shining example" of how NAFTA can work. "We need to keep pork trade flowing", said Ken Maschhoff, president of the National Pork Producers Council. In the auto sector alone, the US has a $68 billion deficit with Mexico.

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The talks that started this week in Washington are the first of several rounds to renegotiate the agreement Mr Trump has repeatedly declared as "the worst trade deal" because it is "very, very bad for our companies and for our workers".

The United States wants to increase the content threshold for NAFTA goods in a bid to return manufacturing jobs to the United States, and the auto industry has conceded that the rules should be updated to account for auto components that did not exist when the original deal was signed. Canada, the US and Mexico account for a quarter of the world's GDP (Gross Domestic Product) with 7 percent of its population.

We hope wise and level heads in Washington will heed the strong arguments for a new trade deal that's fair to every partner.

Mexican and Canadian leaders framed their desires around "modernizing" NAFTA to reflect more of today's global economy, including guidelines for e-commerce, which isn't included in the 23-year-old deal.

Mexican Secretary of Economy Ildefonso Guajardo conveyed similar sentiments about the pact he called a "strong success for all parties".

"If you ask numerous members, they will say that their constituents have benefited from the NAFTA and they're very reluctant to change what is going on now in part because they know the potential losses", Schott told Xinhua.

Canada's goal is "bolstering what works, improving what can be made better" in the accord, which encompasses a quarter of the world's economy and seven percent of the world's population, she said.

Other reports by MaliBehiribAe

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