NAFTA talks bog down over U.S. demands as latest round concludes

Mexico's Economy Minister Ildefonso Guajardo, left, looks on as Canada's Foreign Minister Chrystia Freeland, center, and U.S. Trade Representative Robert Lighthizer shake hands at the close of the third round of Nafta talks involving the U.S., Mexico and Canada in Ottawa on September 27.

If the deal falls apart there is no economic analysis as to what would happen but Lighthizer said "my guess is all three countries would do just fine".

The meeting will be terminated in fourth part of negotiations, USA trade representative Robert Lighthizer, Canadian Foreign Minister Christia Freeland and Mexican economy Minister Ildefonso Guajardo Villarreal.

Describing some of the demands as "ridiculously extreme", Moises Kalach, head of the worldwide negotiating arm of Mexico's powerful CCE business lobby, said the US government knew that it would not be able to push them through.

This latest round of negotiations highlighted the significant gaps remaining among the three North American trading partners.

The canadian government has said that this proposal was doomed to failure. "Because of its complex supply chains that cross both borders, the auto industry would suffer the most, with autos accounting for almost 40% of exports to Canada and 22% of exports to Mexico". Officials from the three countries had hoped to conclude the negotiations by year's end but now expect the talks to continue into 2018.

At the same press conference after a fourth round of talks, Canadian Foreign Minister Chrystia Freeland said some of the Nafta proposals would have run counter to World Trade Organization rules. "Countries are reluctant to give up unfair advantages".

Lighthizer said the focused on lowering its trade deficit as part of what he called a more market-oriented agreement that would grows the manufacturing sector as part of any trade negotiation.

While getting business and labor on board might sound like an impossible task, "the day will come" that will prove it can be done, he said. It's possible that his administration is trying to sabotage the agreement to justify a withdrawal, said Paul Ashworth, the chief United States economist at Capital Economics. The Bloomberg report states that NAFTA's fate may now depend on how flexible the about its demands heading into the fifth round of talks, scheduled for Mexico City in early November. "Michigan, Illinois and Texas are the states that would suffer greatest disruption".

But Lighthizer said that it wasn't a hard target and it was agreed by the negotiators to push into next year.

  • Rogelio Becker