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NAFTA negotiations: Ignore the thunder, wait for the light


An early resolution of trilateral NAFTA negotiations between Mexico, the United States and Canada is not expected as major issues remain unresolved, while the sixth round of negotiations are underway in Montreal.

Canadian Minster of Foreign Affairs, Chrystia Freeland, says Canadian negotiators are entering this round of NAFTA talks with a slate of “creative proposals” to counter some of the demands made by the U.S..

U.S. representatives had pushed back against the progressive trade agenda being proposed by Canada – entrenching Indigenous, gender and workers’ rights issues in the pact.  Canada, in turn, is not willing to accept four controversial U.S. demands some are calling “poison pills”: raising continental content provisions on automobiles, scrapping a dispute resolution mechanism, limiting Canadian access to U.S. procurement and instituting a five-year sunset clause.

Neutral observers have pointed out that millions of jobs on both sides of the border will be at risk if the U.S., or more precisely President Donald Trump, follows through on threats to pull out of the trade deal.

“We can expect to hear a fair bit of bluster from the U.S. negotiators,” says Brian Rowe.  “They will suggest the agreement is not fair, yet Canada is the number one import market for 32 of 50 States and as a whole, we buy 15% of the U.S.’s exports.  The U.S. cannot afford to just walk away.  The backlash from affected U.S. States would be devastating.  Whether U.S. threats to scrap NAFTA are just bargaining chips remains to be seen.” 

There is room, however, for changes that benefit all three countries.  No country will get everything they want.  There will be give and take.  That is the nature of trade deals.

For more information, contact Brian Rowe, Director – Customs Compliance & Regulatory Affairs.

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