16 th August 2017 marked the beginning of renegotiations between the United States, Canada and Mexico on the North American Trade Agreement (NAFTA). The leaders from each country will meet up over the next few months to begin discussions on the agreement which has been in place since 1994. American view The United States have got a tough stance on the agreement believing it to be more beneficial for Canada and Mexico.
The United States trade representative, Robert Lighthizer reiterated Donald Trump’s critisisim of the agreement ‘‘We feel that NAFTA has fundamentally failed many, many Americans and needs major improvement’’ He said in the opening statement which reflected criticism that blames the NAFTA agreement for a direct loss of around 700,000 US manufacturing jobs since it was put in place. Some of the objectives the of US negotiators include: Improve the U.S. trade balance and reduce the trade deficit with the NAFTA countries Maintain existing reciprocal duty-free market access for industrial goods and strengthen disciplines to address non-tariff barriers that constrain U.S. exports to NAFTA countries Maintain existing duty-free access to NAFTA country markets for U.S. textile and apparel products and seek to improve competitive opportunities for exports of U.S. textile and apparel products while considering U.S. import sensitivities Promote greater regulatory compatibility with respect to key goods sectors to reduce burdens associated with unnecessary differences in regulation, including through regulatory cooperation where appropriate Increase transparency by ensuring that all customs laws, regulations, and procedures are published on the Internet as well as designating points of contact for questions from traders Canadian view Canadian Foreign Affairs Minister, Chrystia Freeland has said she hopes that all three countries can keep what is good about the current NAFTA agreement, while using the negotiation process to make the current agreement more modern At the start of the negotiations, Freeland said ‘‘We pursue trade, free and fair, knowing it is not a zero-sum game’’. She also added that Canada is the United States’ biggest client and that Canada buys more from United States than China, Japan and the United Kingdom combined.
Canada’s objectives include: A new chapter on labour standards A new chapter on environmental standards Expanding procurement Freer movement of professionals Protect Canada’s supply-management system for dairy and poultry Mexican View Mexico’s Economy Minister Ildefonso Guajardo said that the main challenge of the negotiation process will be to find any common ground between the three sides. ‘‘The process that begins today is not about going back to the past. For a deal to be successful it has to work for all parties. Otherwise it is not a deal’’.
Mexico’s top objectives include: Foster more inclusive regional trade Update energy, digital and telecommunications provisions Strengthen North American competitiveness Maintain agriculture access All three parties have their views on how the NAFTA agreement should look like moving forward, however there is currently no timeframe of when the negotiations will end.All parties will hope they can reach an agreement as soon as possible, especially with Mexico elections taking place in July 2018. By: Klavs Valters GO Markets
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