Possible breakthrough in NAFTA talks with Mexico

Some Mexican officials are optimistic that a breakthrough in renegotiation talks for the North American Free Trade Agreement (NAFTA) may be achieved next week and that Canada, who left the talks when the U.S. slapped tariffs on some imports, could rejoin the trilateral discussions and conclude a deal.


Mexico and the United States resumed talks last week, after a U.S. move to slap tariffs on Mexican and Canadian metal exports and Mexico's July elections stalled negotiations that began last year when President Donald Trump demanded a better deal for U.S. workers.

"Technically, we are ready to move into finishing the issues, Mexico-U.S. issues, the most next week.  There are very good probabilities that we'll be landing solutions," Guajardo said in English.

"We are optimistic that we can try to land a deal before the end of August," adding there were "three critical, specific points" to resolve that he declined to specify.

Another senior Mexican negotiator was a little less bullish about the chances of a deal this month.

"I am cautiously optimistic. I think it can be done, but there can also be problems. We have to see," Jesus Seade, who joined the Mexican negotiating team last week representing President-elect Andres Manuel Lopez Obrador[, said].

Canada has not been at the table in rounds of talks over the past weeks. Some experts say this is a sign of tensions between Canada and the United States, while officials insist trilateral talks will soon resume.

Mexico's new socialist government appears to be more open to boosting auto workers' wages – a key U.S. demand that Mexico had been unwilling to address.  There is also the issue of requiring a renegotiation of the deal every five years.  That seems a little excessive, and the U.S. may be willing to lengthen that time period in exchange for other concessions.

Canada and Mexico are two of our largest trading partners, and it would be a significant accomplishment if the Trump administration could improve on the deal negotiated two decades ago by the Clinton administration. 

How big a change in our trading relationship can we expect?  With Mexico, especially, requiring the Mexicans to enforce provisions already in the deal would be a significant change.  Canada is a different story.  There won't be major changes in the key provisions of the deal but Trump will be able to claim victory if Prime Minister Trudeau signs anything. 

If something can be done before midterms, it could affect the outlook for GOP maintaining control of the House.

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