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NAFTA – another bump in the road

NAFTA – another bump in the road
May 07, 2018

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The U.S. is still driving a hard bargain, as an important week for NAFTA negotiations begins

By Kate Ayers
Staff Writer

NAFTA discussions enter a critical week as government officials look to address key areas of the agreement before Mexican and American elections.

Today, government officials from Canada, the United States and Mexico begin another round of meetings in Washington to negotiate the trade deal, a Reuters article said today. 

The American Republican-controlled Congress threatens to reject the deal if talks are too prolonged, Robert Lighthizer, U.S. trade representative, said last week. The goal is to complete a vote during the “lame-duck” period before November’s congressional elections, the article said.

Andres Manuel Lopez Obrador, Mexico’s presidential front-runner, says he wants a role in reforming the trade deal, if elected.

“We have a window of opportunity in the next two or three weeks … considering two things: where the talks are now and the political calendars” of Mexico and the U.S., Moises Kalach, lead of Mexico’s private sector negotiations, said in the article.

All sides remain deeply divided on critical issues within the agreement.

Donald Trump, U.S. president, is strongly pursuing his desire to increase the North American content of cars by 12.5 per cent, and to bring more jobs and investment north from Mexico, the article said.

But Mexico remains opposed and calls this demand “not acceptable.”

Despite nine months of negotiations, these key issues remain unresolved.

America’s proposed sunset clause, which would mean the deal would have to be renewed every five years, would result in uncertainty for businesses, critics say.

The U.S. is also pushing to reform dispute resolution to use the domestic legal system instead of international tribunals, the article said.

But Canada, Mexico, and U.S. business are opposed to this offer.

The possibility of reaching an agreement this week is dependent upon U.S. flexibility, a Mexican source close to deal negotiations said in the article.  

Ronnie Chua / iStock / Getty Images Plus photo