Mexico readies for worst as 4th round of NAFTA talks open

Posted October 13, 2017

The U.S. Chamber of Commerce on Tuesday accused Trump's administration of trying to sabotage the talks with "poison pill proposals", including demands for more favorable treatment for the U.S. side on auto production, and a "sunset clause" to force regular negotiations.

He and Mexican Economy Minister Ildefonso Guajardo Villarreal and Canadian Foreign Minister Chrystia Freeland are expected to make a joint appearance. Mexico strongly opposes such a move, which would damage its own auto industry.

President Donald Trump and Canadian Prime Minister Justin Trudeau put up a front of accommodation and cooperation at the White House that belies the alarms being raised by industry and farm groups over changes to Nafta being pushed by the U.S.

U.S. Trade Representative Robert Lighthizer kicked off the latest round by announcing an agreement on a chapter on competition.

Pressed over whether the NAFTA pact could degenerate into a series of bilateral deals, Trudeau said that his administration was "ready for anything and will continue to protect Canadian interests". It's the second topic to be agreed on along with the chapter on small and medium-size businesses. Replying to a question, Trump said he would consider a trade pact with Canada minus Mexico, adding that both the United States and Canada wanted to protect their workers. Scheduled talks in this session have been extended by two days to Tuesday. Negotiators began the fourth round of discussions to rework NAFTA on Wednesday outside Washington. "When North America wins, America wins, and the American people win as well", he said.

"Instead of encouraging more USA content, these provisions will lead to less US content", Wilson said. Representatives of the auto industry warned some of the USA demands could raise prices for vehicles.

"There are several poison pill proposals still on the table that could doom the entire deal".

The Chamber and the trade group for Mexico's auto industry already have come out against an anticipated proposal to raise US -specific content.

The hard issue of rules of origin will be addressed mostly at the end of the current talks, according to a schedule obtained by Reuters.

The auto parts study was conducted before these targets were revealed.

Finance Minister Bill Morneau, in Washington for meetings with G20 finance ministers and the International Monetary Fund, was confronted Thursday with several questions about a possible US exit from NAFTA. Chief Executive Officer Don Walker said in an interview ahead of the talks.

However, a study released on Thursday by the Motor Equipment Manufacturers Association, which represents USA auto parts makers, showed the higher content requirements would lead to the loss of up to 24,000 U.S.jobs, as some companies would forego NAFTA's tariff-free benefits and ship in more components from other countries. Donohue pledged to fight "like hell" to defend NAFTA if Trump tries to pull out, and urged Lighthizer to get a deal.

If Britain did join NAFTA, manufacturers wanting to export to the European Union and North America would have to produce goods in accordance with the two separate sets of rules, according to trade analysts.

Trudeau's visit to Mexico is his first official sojourn to the country and follows Pena Nieto's visit to Canada in June 2016.

"In terms of trade, the USA sells more to Canada than it does to China, Japan and the United Kingdom combined".

Phil Levy, senior fellow at the Chicago Council on Global Affairs, pegs the chance of NAFTA's survival at less than 50 percent.