U.S. NAFTA proposals: Going over like a lead balloon?

October 20, 2017

Sandi Soendker


The fourth round of the North American Free Trade Agreement negotiations wrapped up Tuesday in Washington, D.C. Phrases like “labor standards,” “dairy,” “rules of origin for autos,” “sunset clause” and “trade deficit” were tossed around along with more ill-omened words like “impasse” and “nonstarter.”

Some of the hardline proposals made by the U.S. are clearly not well received by Canada and Mexico, and few now expect NAFTA 2.0 to remain on the fast track.

In his closing statement, U.S. Trade Representative Robert Lighthizer firmly clarified President Trump’s objective to rebalance the $500 billion trade deficit.

“For us, trade deficits do matter,” Lighthizer said. “And we intend to reduce them.”

Lighthizer said he was surprised and disappointed by the resistance to change.

“As difficult as this has been, we have seen no indication that our partners are willing to make any changes that will result in a rebalancing and a reduction in these huge trade deficits. Now I understand that after many years of one-sided benefits their companies have become reliant on special preferences and not just comparative advantage. Countries are reluctant to give up unfair advantage.”

In his statement he also said “the president has been clear that if we are going to have an agreement going forward, it must be fair to American workers and businesses that employ our people at home.”

Mexico will host the fifth round of talks in Mexico City from November 17-21, 2017. Additional negotiating rounds will be scheduled through the first quarter of 2018.