On August 16, 2017, teams from the United States of America, Canada and México launched negotiations seeking to modernize the North American Free Trade Agreement (NAFTA).
The three countries issued a joint statement (https://ustr.gov/about-us/policy-offices/press-office/press-releases/2017/august/trilateral-statement-conclusion) stressing their commitment to modernize NAFTA and accelerate the negotiation process.
The teams were headed by the United States Trade Representative (USTR) Robert Lighthizer, Canadian Foreign Affairs Minister Chrystia Freeland, and the Mexican Secretary of the Economy, Ildefonso Guajardo.
With regard to balance of trade, the U.S. has reiterated the need for a reduction of its trade deficit with Mexico, while the latter has been receptive to discussing this topic as long as no protectionist mechanisms are implemented, but rather that the goal be an increase in the overall balance of trade.
Regarding labor issues, in connection to the low-cost workforce in Mexico, this country has expressed its concurrence with stronger labor standards. However, it has made clear that no wage increases implemented through NAFTA will be accepted.
In addition, regarding one of the most controversial issues, rules of origin, Mexico has expressed its refusal to establish country-based rules of origin as opposed to the current region-based ones. This stance is contrary to the U.S. position in connection with minimum U.S. content in the rules of origin.
Regarding the U.S. position on eliminating Chapter 19, concerning the dispute settlement mechanism in relation to trade remedies such as anti-dumping and countervailing measures (AD/CVD), Mexico and Canada have expressed their rejection.
The next round will take place in Mexico City during the first week of September. Furthermore, a third round in Canada is tentatively scheduled for late September, as well as another round for October, held again in the United States.
