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Envoys Aim for Fast Track on NAFTA Updates
Negotiators hope for a fast start today on talks to update the 23-year-old North American Free Trade Agreement.
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Negotiators hope for a fast start today on talks to update the 23-year-old North American Free Trade Agreement.
Envoys describe today’s agenda as “ambitious” as they try to merge proposals from Canada, Mexico and the U.S. The trade representatives are targeted a completed overhaul of the pact by early 2018.
A primary objective for the U.S. team is to reduce the country’s $64 billion trade deficit with Mexico, better balance its $11 billion shortfall with Canada and find ways to encourage manufacturers to operate in the U.S.
One likely source of debate will be about Chapter 19, NAFTA’s mechanism to resolve trade disputes. The U.S. wants to scrap the measure, which would enable it to unilaterally impose border taxes. Canada urges the opposite tack, aiming to strengthen the process.
Another contentious topic will be NAFTA’s rules of origin, which determine whether goods contain enough local content to avoid tariffs within the trade bloc. The U.S. aims to raise the threshold above its current 62.5%. Canada and Mexico—along with many parts suppliers in the region—believe the current balance is working well to make North America more competitive with manufacturers in Europe and Asia.
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