Canada, United States and Mexico met to review their copy on Nafta

  • AFP

    Monday, 14 August, 2017 00:54

    Monday, 14 August, 2017 00:54

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    Erected in mantra by Donald Trump, the renegotiation of the free trade agreement north american (Nafta), of which the first round is being held this week in Washington, promises to be a thorny issue.

    After a time poses the threat to withdraw from Nafta, the u.s. president had finally opted for its renegotiation quick ” in the interest of the three countries, Canada, the United States and Mexico.

    Their negotiators will meet Wednesday to Sunday in the u.s. capital to launch the modernization of the treaty of 1994, which abolished the customs borders to allow the free movement of goods and services between these three countries.

    Since its inception, the Nafta is extremely controversial. Considered unfair, and destructive of jobs by its detractors, the accelerator of growth by its advocates, it has been the favorite target of the u.s. president during his campaign, which has even been called ” a disaster “.

    The renegotiation of Nafta is crucial to Donald Trump, who must send a strong political signal so that it can barely keep its election promises.

    “He has no other choice than to act. It is politically essential, ” observes and Edward Alden, the Council of Foreign Relations, an influential think-tank. “And at a given time (of the negotiations), the president Trump will have to enforce a result that he will cry like victory,” he said.

    On the merits, the United States deplored the fact that their trade balance with Mexico has passed since the treaty is a surplus of $ 1.6 billion to a deficit of $ 64 billion.

    Nafta has become vital for the mexican economy, for which the United States is the main trading partner: 80 percent of mexico’s exports, mainly goods manufacturing and agriculture, are in fact intended.

    Mexico’s auto industry, a sector that should be one of the subjects at the heart of discussions, with agriculture, has benefited greatly from free trade to the detriment of its american counterpart, which has multiplied the relocation to take advantage of a cheap labor force.

    “Too many Americans have suffered from the closure of the factories, the export of jobs and the political promises not kept,” has recently emphasized the special representative for Trade outside u.s. (USTR), Robert Lighthizer.

    Between the United States and Canada, the trade balance is close to equilibrium, but the debate is focused on dairy products, the wine and the grain, accused by Washington of being subsidized.

    Quick start

    If the United States forced Canada and Mexico to get around the table, the three parties agreed on the need to rejuvenate this text, dating back nearly a quarter of a century, developed even before the internet era.

    “Each country has the feeling of having a lot to gain in these negotiations. Therefore, everyone knows that he has the interest to modernize the treaty with success, ” said Jeffrey Schott, an expert in Nafta, the Peterson Institute for International Economics (PIIE).

    “It is the American competitiveness in the face of the Asia especially,” says Edward Alden.

    Despite the pushback the united states, the specialists do not expect an early outcome of the renegotiation.

    This first round of discussions is expected in addition to make just a broad overview, before the second already scheduled for September 5 in Mexico.

    “They are going to strive to have a start (discussions) fast and in this perspective they should not refer to any of following questions that make people angry,” says Mr. Schott.

    For all that, we can not exclude the risk “that the United States ideas are very controversial that would jeopardize the discussions,” he said. Highlighting “America first” or “Buy american” would be unacceptable to its neighbours.

    After the multiplication of abusive statements on the deficit with Mexico, the u.s. administration must show itself to be inflexible on this litigation.

    On the mexican side, the resistance should be strong in the prospect of the presidential elections of 2018.

    “Mexico is probably in the weakest position “, because of its economic dependence on Nafta, “but it has the advantages and features of negotiators are extremely experienced and present in many trade agreements,” notes Edward Alden.

    Finally, the United States also have much to lose. The mexican market is crucial, particularly for american agriculture, which traditionally weighs its weight in trade negotiations.

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