U.S. and Mexico trade representatives have reached a consensus on revamping the historic North American Free Trade Agreement.
That consensus was reached without the participation of Canada, the other NAFTA partner.
Outgoing Mexican President Enrique Pena Nieto has said that he would prefer a trilateral deal, hoping that Canada will eventually return to talks with the U.S. and Mexico.
Meanwhile, Canadian Foreign Minister Chrystia Freeland, after meeting with U.S. Trade Representative Robert Lighthizer, said her office will “stand up for the Canadian national interest and for Canadian values, while looking for areas where we can find a compromise.”
U. S trade representatives are expected to officially notify Congress that an updated agreement between the U.S. and Mexico has been reached.
Once that notification has been made, there will be a 90-day period during which the representatives of both the U.S. and Mexico will be required to officially sign the new deal.
What the new agreement will be called remains unknown. President Trump, who frequently criticized NAFTA during his 2016 presidential campaign, said the name “NAFTA” would most likely be discarded because it has negative connotations.
The President’s suggested new name: the U.S.-Mexico Trade Agreement.
One aspect of the new agreement is seeing Mexico guaranteeing that automotive content manufacturing will be increased in the U.S. in a move that will spur greater auto production in America.
Since its inception, NAFTA has covered a wide variety of building materials and equipment, with materials from the U.S. going to the other two countries equaling $39 billion in 2017; and imports above the $43 billion mark last year.
The new preliminary trade agreement will not, for the present, do away with the existing U.S. tariffs on Mexican exports of steel and aluminum.
Altogether, at least 80 percent of Mexico’s exports go to the U.S.
The two countries also agreed that the new agreement would be up for review every six years, although the agreement itself has a 16-year life.
By Garry Boulard
