Published: Sat, May 20, 2017
Business | By Max Garcia

Mexico private sector eyes more NAFTA content in future products

Mexico private sector eyes more NAFTA content in future products

But he says it's still early days and that Canadians need to step back until the Congress' review is over and the US position is clearer.

"Why in the world would USA trade policy target its two neighbours and two best customers, when we are so tightly linked, and should be working in concert to compete globally?" said Bank of Montreal chief economist Douglas Porter.

"The president's leadership on trade will permanently reverse the unsafe trajectory of American trade", Lighthizer told reporters Thursday.

Mr Lighthizer said Nafta had not kept up with changes in the economy and business over the last 25 years, including the boom in e-commerce.

Since NAFTA went into effect January 1, 1994, USA trade north and south of the borders has more than tripled, growing more rapidly than US trade with the rest of the world.

The original NAFTA, enacted in 1994, essentially dropped all tariffs between the U.S., Canada and Mexico to zero. The administration has made reducing the trade deficit a priority, and Lighthizer suggested Thursday the USA will seek to lure back firms that have moved production to Mexico.

The consequences of Mexico's sugar rush have been felt in the United States, as the last sugar producer in the state of Hawaii closed its doors earlier this year, and a major sugar beet factory in Wyoming is scheduled to go belly up soon. The trade pact eliminated tariffs " taxes on imports " and other trade barriers among the United States, Canada and Mexico.

"Working closely with Congress and following the requirements of the Trade Priorities and Accountability Act, we will continue to review elements of NAFTA and, where appropriate, update USA approaches to address the challenges faced by USA consumers, businesses, farmers, ranchers and workers in an increasingly global economy", Lighthizer wrote. However, he added that the agreement doesn't do enough to address digital commerce and intellectual property, and that labor and environmental matters are treated as an "afterthought". "There is value in making the transition to a modernized NAFTA as seamless as possible", he said. "We look forward to working with Ambassador Lighthizer and other Trump Administration officials during the renegotiation process to provide helpful data and input". "President (Donald) Trump is going to change that", he said. "Without this trade agreement and the market access it provides, the United States would stand to lose almost $2 billion annually in dairy exports and tens of thousands of farming and manufacturing jobs in communities across the country", said Michael Dykes, D.V.M., IDFA president and CEO.

Canada's Foreign Affairs Minister Chrystia Freeland, who met Mr Lighthizer on Tuesday and meets her Mexican counterpart in Mexico City next week, also said the negotiations must be among the three nations. The president was already facing a backlash over his firing of the FBI director and accusations he tried to end an investigation into the former national security adviser - which the White House denies. During that time, the administration must meet with members of the House Ways and Means and Senate Finance Committees, with a view toward coming up with the principles the USA will adopt during the negotiations. The administration will work closely with Congress to ensure that the goals of the renegotiation are consistent with congressional priorities, Lighthizer wrote.

And what you can read into it is that the Trump administration, even taking into account the expected pre-negotiation posturing, is indeed looking for far more than simple tweaks.

"So one-sided. Wilbur will tell you that, you know, like, at the court in Canada, we always lose".

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