[CTC] U.S. and Mexico could reach a deal next week; auto, financial issues remain

[Arthur Stamoulis]

Guajardo: U.S. and Mexico could reach a deal next week; auto, financial
issues remain

August 17, 2018, Inside US Trade

Mexican Economy Secretary Ildefonso Guajardo on Friday said the U.S. and
Mexico could strike a deal on bilateral issues in the North American Free
Trade Agreement by next week, though he noted that the two sides must still
reach agreement on the transition period for new auto rules of origin as
well as on undisclosed “financial items.”

Sector-specific teams are continuing to meet, he said after meeting with
U.S. Trade Representative Robert Lighthizer on Friday. Guajardo will return
to Washington, DC, next Tuesday to resume bilateral talks – the fifth
consecutive week the two have met.

Talks on autos are “progressing,” he said, but the U.S. and Mexico have not
yet agreed on the phase-in period for new auto rules of origin, which was
discussed on Friday. *Inside U.S. Trade* previously reported
<https://insidetrade.com/node/163926> that the transition period for auto
rules was one of the last sticking points in the bilateral talks. Guajardo
added that the two sides also needed to discuss “financial items,” but did
not elaborate.

Guajardo also emphasized that Canada must be part of the final NAFTA
discussions.

Trilateral discussions could begin as soon as next week, he added.

Negotiators are hoping to reach an agreement in principle by the end of the
month to allow Mexican President Enrique Peña Nieto to sign a deal before
he leaves office. Canadian officials have said they have not been involved
in the NAFTA discussions in recent weeks because the U.S. and Mexico must
first solve issues pertaining to autos and wages before trilateral talks
can resume. President Trump on Thursday said he was in “no rush
<https://insidetrade.com/node/164101>” to complete a deal, adding that the
U.S. was not negotiating with Canada because its tariffs and non-tariff
trade barriers are too high.

Guajardo has previously said the U.S. push for a sunset clause would have
to be discussed trilaterally.

USTR did not respond to a request for comment on whether it would negotiate
with Canada bilaterally or engage in trilateral talks once the U.S. and
Mexico resolved their bilateral differences.

A group of North American labor unions on Friday used the push to wrap up
the NAFTA talks as an opportunity to call on the U.S., Mexico and Canada to
ensure workers will have access to dispute settlement procedures in a
modernized deal. In a letter to Lighthizer
<https://drive.google.com/file/d/1u7gnYSC30g8CjwMIHbb14DPcizJn43pM/view>,
the groups said a labor chapter in NAFTA should “meet the basic standards
of the International Labor Organization’s eight core conventions”; “ensure
that the complaint process and dispute resolution mechanism are accessible
to workers, timely and transparent” and “avoid barriers to complaints and
dispute resolution.”

The labor chapter is a key issue for congressional Democrats. Lighthizer
has said he wants a modernized NAFTA to have broad bipartisan support. The
labor groups recommend that a new labor chapter exclude “vague
‘trade-related’ or ‘manner affecting trade’ standards, which are subject to
misinterpretation, in favor of a standard that acknowledges the
inextricable relationship between labor and trade.”

The U.S. labor proposal includes a footnote
<https://insidetrade.com/node/162820>clarifying those terms.

AFL-CIO, Centro de Derechos del Migrante and 30 other groups signed the
letter, which will be sent to Guajardo and Canadian Foreign Affairs
Minister Chrystia Freeland next week, according to an AFL-CIO
statement. – *Brett
Fortnam* (bfortnam at iwpnews.com)

Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826
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