Mexico, Canada insist Nafta to stay trilateral

Mexican and Canadian officials insist that any renegotiated North American Free Trade Agreement (Nafta) will be trilateral, despite US President Donald Trump's preference to strike separate deals with each country.

"The negotiation method might be bilateral, but it is just that: a method," Mexico's economy minister said yesterday in Mexico City in a joint press conference with Canada's foreign minister Chrystia Freeland. "The essence of this treaty is trilateral."

The two ministers joined in the statement to make clear Mexico would not sign a bilateral deal with the US, even as the Mexican delegation meets today in Washington, DC, with the US team.

At a White House event on 23 July President Trump said "We are talking to Mexico on Nafta, and I think we are going to have something worked out," leading to concerns about a possible bilateral deal between the US and Mexico. US trade representative Robert Lighthizer today told a Senate panel he was hoping to make progress with Mexico first, before getting Canada to move closer to the US position.

"Our hope is that before long we will have a conclusion with respect to Mexico, and as a result of that, Canada will be willing to come in and compromise," Lighthizer told the Senate appropriations Committee. He said the Mexican delegation he is meeting today would include representatives from the team of president-elect Andres Manuel Lopez Obrador, who takes office 1 December.

The Canadian delegation also met with the outgoing and incoming administrations in Mexico City. "Canada very much believes in Nafta as a trilateral agreement," Freeland said after the bilateral meetings yesterday.

Mexico and Canada's top Nafta negotiating officials also rejected the sunset clause which would provide a five-year automatic suspension of the deal unless the three countries agree to update it.

"Nobody is going to invest a single Canadian dollar, a Mexican peso, or a [US] dollar in an industry that does not include certainty for the long term," Guajardo said.

Mexico's foreign relations minister Luis Videgaray said the country could not ask the auto industry to design a business model for a five-year time frame.

"We cannot ask them to invest with a note in fine print saying ‘we might change our minds in five years,'" he said.

Freeland also met with the possible next Mexican foreign minister, Marcelo Ebrard.

For now, all negotiating authority remains on current President Enrique Pena Nieto's team, although outgoing and incoming administrations have vowed to align their strategies on renegotiation.

Ebrard said that even if the talks are held bilaterally, the final deal will be trilateral.

"The strategy is that the deal ... involves the three countries," he said.

Lighthizer said today he hoped — but could not guarantee — that Nafta talks would wrap up by the end of August. The deadline appears arbitrary, however. US laws require a formal 90-day notification to Congress of the conclusion of talks before the president can sign the renegotiated agreement and submit it to Congress for ratification by an up or down vote. Concluding talks by the end of August would allow Trump to sign it with Pena Nieto by the time he steps down on 1 December, Lighthizer said.