Monday, 17 December, 2018

Mexico says working hard with US on new NAFTA auto rules

Workers in a car factory Workers in a car factory
Rhonda Young | 12 August, 2018, 06:22

Canadian officials have said talk of their alleged inflexibility is simply a negotiating or public-relations tactic by the Americans, and that President Donald Trump's chief concern about NAFTA is the large American trade deficit with Mexico.

A USA -proposed so-called sunset clause that would kill a NAFTA deal unless it is renegotiated every five years has been another major stumbling block in the talks.

But details of what is happening behind closed doors came largely from second-hand accounts of the talks Thursday.

Asked about the reports, the office of U.S. Trade Representative Robert Lighthizer raised no objections to their accuracy.

As he left the meeting about two-and-a-half hours later, the minister said the two parties are "as close as possible (to a deal), but we're still working on it".

Jesus Seade, the trade negotiator representing Mexico's new president elect, stayed quiet as the delegation strode away, reporters trailing behind.

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When asked whether negotiations next week would include Canada, Guajardo said, "hopefully" once the US and Mexico advance their talks. That could happen as early as next week.

Mexico's economic minister Guajardo is on the wires saying that the NAFTA talks are going very well, but there is no deal yet.

Gregg Doud, the chief US agriculture negotiator, contrasted the Canadian stance with what he suggested was smooth sailing in talks with Mexico, according to agriculture-media coverage of a speech he made this week in MI.

Those requests by the US are meant to counter the administration's view that too much of what's made under NAFTA is out-sourced to low-wage destinations, robbing Americans of good jobs.

But there is no specific date to return to trilateral discussions, he said.

"A free-trade agreement is supposed to provide certainty, and this would hurt investment in Mexico and the competitiveness of North America", Moises Kalach, the trade head for the Mexican business chamber known as CCE, said in an interview last week.

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The other issue is the sunset clause that allows the U.S. to back out and reset after a certain time period.

And none of it means anything in terms of a new NAFTA agreement unless the northern partner signs on as well, says another source familiar with the auto-related negotiations. "They should like this ..."

Asked if a deal would be reached on the contentious rules of origin for autos, Guajardo repeated that "nothing is agreed to until everything is agreed to".

Canadian officials have suggested there is nothing unusual about the long stretch of bilateral negotiations excluding them, and are happy the other two countries have made progress.

While Canada hasn't attended meetings in the past three weeks, and Trump administration officials have been more publicly optimistic about talks with Mexico than Canada, Canada and Mexico have reiterated that they expect NAFTA to remain a three-nation agreement.

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