US running out of time on NAFTA while confronting China

Marsha Scott
May 18, 2018

All three countries agreed that they would keep negotiating beyond Thursday, a date that had been presented as a procedural deadline for getting a deal to the U.S. Congress for a vote this year.

The latest of these - an informal target date of May 17 set by US House of Representatives Speaker Paul Ryan for the deal to be concluded with sufficient time to pass the necessary procedural hurdles in Congress before the US mid-term elections - has now come and gone.

This comes as Canada's prime minister said he feels positive about NAFTA talks, and that there's a good deal on the table. And if the Democrats do end up taking the House in November - a realistic (if not assured) scenario - the Trump administration's endeavour to get a new deal "that works for everybody, but most importantly... a deal that works for America" could very well hit a brick wall.

Among them: government procurement, US access to Canada's dairy market, the system for resolving trade disputes, and the USA proposal for a "sunset clause" that would automatically terminate NAFTA in five years absent a new endorsement from all three countries.

Canada's argument went that if the USA claims to be reopening NAFTA specifically to deal with its trade deficit, and if the leading cause of that trade deficit with Mexico involves autos, and if the autos issue is nearly solved, then the Americans could walk away right now with a win.

U.S. trade chief Robert Lighthizer has expressed some frustration on Thursday, as reported by Reuters, as the US' self-imposed deadline for a deal on NAFTA has slipped by without anybody seeming to care, and the NAFTA renegotiations continue to drag on. Mexico's presidential election will be held in July, and the expected victor could take a harder stance against President Donald Trump and renegotiating the trade deal.

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With attention focused on the contentious issues of cars, Trudeau said that Mexico had made proposals that "will go a long way towards reducing the trade deficit the USA has with Mexico and indeed even bringing back some auto jobs from Mexico to the United States".

Trudeau drew another public contradiction Thursday - this one from Mexico.

"I would not rule out the possibility of reaching (a deal) at any moment from the last week in May, or as long as it takes", Guajardo told journalists. In any case, he said he was ready to keep negotiating: "We'll keep working until they shut off the lights".

Mexico's economy minister Ildefonso Guajardo tweeted on Thursday that Trudeau's remarks needed clarification saying that any renegotiated NAFTA "that implies losses of existing Mexican jobs is unacceptable".

That uncertainty has been compounded by the tariff threats.

Other reports by MaliBehiribAe

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