With about two weeks left until what may by the final deadline for a new NAFTA this year, Mexico and Canada are signaling there is a deal to be had, if President Trump wants one. U.S. Treasury Secretary Steve Mnuchin, speaking in a Fox News interview this past weekend, said the president’s priority is getting a good deal, even if it means disregarding any deadlines to let current lawmakers approve it.
After nine months of negotiations, the nations remain far apart, Mnuchin said earlier this week. “So, whether we pass it in this Congress or we pass it in the new Congress, the president is determined that we renegotiate NAFTA,” he said.
House Speaker Paul Ryan said May 17 was the deadline to notify Congress of intent to sign a deal, citing U.S. trade law timelines. He has since extended that time frame by a week or two, putting the deadline near the end of May.
With a possible U.S. Chinese trade war “on-hold,” the Trump administration has potentially more leeway to concentrate on the NAFTA negotiations. The question remains as to whether all sides are willing to give the “flexibility” that Mexico chief negotiator said is needed to reach agreement on the toughest issues.
Bruce Heyman, a former U.S. ambassador to Canada under Barack Obama said that the “last leg” of trade talks is always tough. “I think the real question that has to be asked is does the U.S. administration want a deal or not? I think there is a push-pull going on with Republicans,” Heyman said.
Negotiators have so far completed about nine of about 30 chapters of a final deal, Mexico’s chief NAFTA negotiator Kenneth Smith Ramos said. “The last mile will require flexibility for all three parties in order to find the balance that may allow us to close the negotiation,” Ramos said.
The auto sector remains one of the most thorny issue. If an agreement is struck on autos, it is possible that other contentious issues could fall into place and a deal could be reached quickly. Other thorny topics are in agriculture, a U.S. proposal to dismantle Canada’s system of quotas and tariffs in its dairy sector, intellectual property, and U.S. demands for a five-year sunset clause as well a dissolving certain dispute panels–each of which were cited as a sticking points by Canadian Prime Minister Justin Trudeau.
Lower-level officials are continuing negotiations. However, it is not clear whether the ministers from the U.S., Mexico and Canada will hold a session this week.
