[CTC] USTR plans to notify Congress of Mexico bilateral if Canada doesn't sign up || Lawmakers insist NAFTA should remain a trilateral deal

[Arthur Stamoulis]

Two articles below…

 
INSIDE US TRADE
USTR plans to notify Congress of Mexico bilateral if Canada doesn't sign up

August 27, 2018 
U.S. Trade Representative Robert Lighthizer will notify Congress on Friday of a plan to strike a bilateral trade agreement with Mexico -- or inform lawmakers of a trilateral pact that includes Canada if Ottawa comes back to the table and reaches a deal in time, he said on Monday.

“What we will do is -- ideally Canada will be in and we’ll be able to notify that. If Canada’s not in then we’ll notify that we have an agreement with Mexico and that we’re open to Canada joining it,” Lighthizer said on a conference call with reporters. The call followed President Trump's announcement of a bilateral agreement with Mexico and claims that he would terminate the existing deal, though Mexican President Enrique Peña Nieto -- during a televised conference call with Trump -- repeatedly emphasized his preference for Canada to be a part of the deal.

Freeland will return to Washington, DC, on Tuesday to resume negotiations with the U.S., according to Adam Austen, a spokesman with Freeland’s office. She was originally scheduled to spend the week in Europe.

“As we have said all along, progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement,” Austen said. “Given the encouraging announcement today of further bilateral progress between the U.S. and Mexico, Minister Freeland will travel to Washington, D.C., [Tuesday] to continue negotiations. We will only sign a new NAFTA that is good for Canada and good for the middle class. Canada’s signature is required.”

Whether Mexico agreed to sign a deal that does not include Canada remained unclear after both the White House event and the call with reporters. White House adviser Jared Kushner said on the call that he believed Mexico was in a position to move forward bilaterally and added that he hoped Mexico will “do what’s right.”

“I think we’re at a position where we’re going to have discussions with ... Canada this week, see where we get to,” Kushner said on the conference call. “But I think at the end of the day, Mexico’s in a position where they want to protect their markets and they’ll hopefully do what’s right for Mexico.”

Mexico and Canada, Kushner added, are part of the Trans-Pacific Partnership, “so it wouldn’t hurt their trading relationship, but again I think we all have a preference to see it come together. But if we’re not able to do that then we’ll move on bilaterally.”

At a press conference at the Mexican embassy on Monday, Mexican Foreign Affairs Secretary Luis Videgaray said that if the U.S. and Canada cannot reach a deal by Friday, there would still be a trade agreement between the U.S. and Mexico. It was unclear if Videgaray was referring to NAFTA or a separate bilateral.

President Trump said Canada would have the opportunity to join a U.S.-Mexico pact, but the U.S. could also reach a separate deal with Ottawa.

“I think we'll give them a chance to probably have a separate deal,” he said in the Oval Office on Monday. “We will see whether or not we decide to put up Canada or just do a separate deal with Canada, if they want to make the deal. The simplest deal is more or less already made. It would be very easy to do and execute.”

According to Trump, the NAFTA moniker is dead whether or not Canada joins the deal. “I like to call this deal the United States-Mexico Trade Agreement,” Trump said. “I think it's an elegant name. I think NAFTA has a lot of bad connotations for the United States because it was a rip-off. It was a deal that was a horrible deal for our country, and I think it's got a lot of bad connotations to a lot of people. And so we will probably -- you and I will agree to the name.”

Lighthizer said he believed notifying Congress of a bilateral deal with Mexico was in line with USTR’s commitments under the 2015 Trade Promotion Authority law despite a May 2017 notification to Congress saying the NAFTA renegotiation would be trilateral.

“We think that satisfies our requirements,” Lighthizer said of a potential notification of a bilateral deal.

In the May 2017 notification, Lighthizer said “I am pleased to notify the Congress that the President intends to initiate negotiations with Canada and Mexico regarding the modernization of the North American Free Trade Agreement.”

The announcement of a bilateral arrangement with Mexico was not intended to pressure Canada, Lighthizer said. Instead, he contended that concluding a bilateral with Mexico was the logical way to eventually ensure a trilateral deal.

“This wasn’t designed to put pressure on anyone or anything like that,” Lighthizer said. “We’re in a position where we had a negotiation that went on for close to a year. The last few months -- several weeks I guess I’d say more accurately -- we decided we were better off to try to get a deal with one party and then hopefully the other. It tends to be the way these things work in any event. It’s hard to have three people all just have the lightbulb go on at the same time. So this is not part of a negotiating strategy or anything.”

“We did it in what I think to be the sensible way,” the USTR added. “We worked with one party, we got through, we worked it out. And now we’re bringing the other party in -- the other party is coming in for the talks.”

In a statement to Inside U.S. Trade, a spokesman from Freeland’s office said Canada was encouraged by the progress in the NAFTA talks, but that Canada would have to sign a final deal.

Lighthizer said Trump’s promise to terminate NAFTA was a necessary part of the process of implementing a new trade pact. “It’s impossible to have two agreements at the same time. Whenever you have an agreement that supplants another agreement, you have to pause or get rid of the prior agreement,” he said. “'How do you do that?’ is something we’re still in the process of looking at. At a minimum the new agreement will supplant the old agreement.... Notionally what the president is saying is you can’t have two agreements like this, and when you get a new agreement you’re not going to have NAFTA anymore.”

The new agreement includes “an alternative to sunset” that “protects the interests of investors,” Lighthizer said. The U.S. had long pushed for a five-year sunset pact that would terminate the deal unless the three parties agreed to renew it, an idea that alarmed Congress and the business community. Canada and Mexico refused to go along.

That alternative, he said on Monday, is a 16-year sunset period with a review every six years, at which time the parties can renew the deal for another 16 years, Lighthizer said.

The deal also includes an investor-state dispute settlement provision, but with some alterations from the original NAFTA for some sectors. The oil and gas, infrastructure, energy generation and telecommunications sectors will have “classic ISDS,” Lighthizer said. Inside U.S. Tradereported earlier this month that ISDS would have a sector-specific component <https://insidetrade.com/node/163997> that would ease concerns from those in the energy sector.

ISDS for all other sectors, however, will be limited to expropriation or failure to give national treatment or most-favored nation treatment.

Congress and the U.S. business community has called for the inclusion of ISDS and for the U.S. to pull back its proposal for a five-year sunset citing the need for certainty in a renegotiated NAFTA. -- Brett Fortnam (bfortnam at iwpnews.com <mailto:bfortnam at iwpnews.com>)

###
 
INSIDE US TRADE
Lawmakers insist NAFTA should remain a trilateral deal

August 27, 2018 
Lawmakers on both sides of the aisle maintained on Monday that the U.S. should include Canada in a modernized North American Free Trade Agreement after President Trump announced the U.S. and Mexico had reached a bilateral deal <https://insidetrade.com/node/164188> he called the U.S.-Mexico trade agreement.

“I think it's an elegant name,” Trump said in a televised phone conversation with Mexican President Enrique Peña Nieto. “We will see whether or not we decide to put up Canada, or just do a separate deal with Canada, if they want to make the deal.”

U.S. Trade Representative Robert Lighthizer told reporters after Trump's remarks that on Friday he planned to submit to Congress a notice of the administration's intent to sign a bilateral deal with Mexico – or a notice of a trilateral deal if Canada agreed to terms <https://insidetrade.com/node/164189>. Canada's lead in the NAFTA talks, Foreign Minister Chrystial Freeland, cut short a trip to Europe to return to Washington, DC, after weeks away from the talks.

For a significant number of Democratic and Republican lawmakers, there is no question Canada should be included in the negotiations.

A trilateral agreement with Canada is “the best path forward,” Senate Majority Whip John Cornyn (R-TX) said in a statement. “This is a positive step, and now we need to ensure the final agreement brings Canada in to the fold and has bipartisan support.”

“I look forward to carefully analyzing the details and consulting in the weeks ahead with my colleagues and constituents,” House Ways & Means Committee Chairman Kevin Brady (R-TX) said in a statement. “I call on Canada to come back to the negotiating table quickly with the aim of concluding a modern, seamless three-way agreement.”

Senate Finance Chairman Orrin Hatch (R-UT), the chairman of the Senate Finance Committee, said “Preserving & improving NAFTA will ensure that American families will continue to benefit.... To achieve that goal, a final agreement should include Canada ... [and] establish strong rules to protect intellectual property rights.”

The ranking member on the Finance panel, Sen. Ron Wyden (R-OR), decried a lack of detail in the announcement on Monday, saying there were  “big unanswered questions as to where negotiations will go with Canada. Furthermore, the administration must follow the laws that I fought to pass to keep Congress and the public informed and give ample time to review any deal before votes are considered. On an issue as important as trade policy, Americans and their representatives in Congress must not be kept in the dark.”

And House Ways & Means Trade Subcommittee ranking member Bill Pascrell (D-NJ) said “NAFTA is a trilateral agreement that includes Canada. So today’s ballyhooed announcement notwithstanding, I view this as a progress report with negotiation still continuing between our three nations.... I look forward to seeing significant changes reflected in a trilateral renegotiated agreement that will finally make a positive difference for working Americans and their jobs.”

Lighthizer reiterated in the conference call with reporters after the announcement that he hoped for broad, bipartisan support for a new NAFTA, which could be impossible if Canada isn’t at the negotiating table.

Trump said he would call Canadian Prime Minister Justin Trudeau “very soon” to discuss the deal and that he was prepared to impose tariffs on Canadian car imports as retaliation for tariffs on U.S. dairy products, “But I think we'll give them [Canada] a chance to probably have a separate deal,” he added.

While Trump referred to the agreement with Mexico as “maybe the largest trade deal ever made,” some lawmakers noted that the administration had a long way to go before it could claim victory.

“Once again, President Trump is announcing a victory before he has an agreement, much as he declared away the North Korean nuclear threat after a handshake in Singapore,” said Rep. Lloyd Doggett (D-TX), a Ways & Means trade subcommittee member. “This is typical Trump -- planning to tweet and tell his rallies he did something that he did not in fact do.”

Sen. Sherrod Brown (D-OH) also said he needed to review the agreement, adding that he spoke with Lighthizer on Sunday last night.

“We still have a lot of work to do to bring Canada on board and write the legislation needed to make any deal a reality,” Brown added.

Rep. Sander Levin (D-MI), a former House Ways & Means Committee chairman, is in Mexico this week discussing labor rights with workers, businesses, researchers and government officials. He said it was “highly unclear” how today's NAFTA announcement could impact key labor issues between the U.S. and Mexico.

“Foreign companies have come to Mexico and exploited workers in combination with Mexican authorities to export products to the U.S. -- products that these workers could never afford themselves,” he said in a statement. “This exploitation negatively affects the jobs and wages of workers in the U.S.”

Lawmakers also pointed to the importance of strong trade relations with Canada for their home states. “During my visits with businesses and families across our district, it is clear that uncertainty over NAFTA is already having real consequences for our region and these will only grow if a conceptual agreement with Canada is not reached soon,” said Rep. Elise Stefanik (R-NY).

Agriculture Secretary Sonny Perdue, meanwhile, praised the agreement as “nothing short of a great victory for farmers and ranchers.”

“We now hope that Canada will see the need to settle all of the outstanding issues between our two nations as well, and restore us to a true North American Free Trade Agreement,” Perdue added in a statement.


Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826




-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.citizenstrade.org/pipermail/ctcfield-citizenstrade.org/attachments/20180827/8031235e/attachment.html>