[CTC] Trump's NAFTA victory lap hits roadblocks over tariffs; Trump drags NAFTA into US-Mexico border threats

Fri Oct 19 07:14:04 PDT 2018

10/19/2018 10:00 AM EDT

By SABRINA RODRIGUEZ (srodriguez at politico.com <mailto:srodriguez at politico.com>; @SabRod123 <http://go.politicoemail.com/?qs=e33fdc0843778fa6e5f85b588fa257835c6c84414794a126d1e8bcf122d11fc068f2c8a55161b3f61a092b6f3112edac>)

TRUMP'S USMCA VICTORY LAP HITS ROADBLOCKS OVER TARIFFS: President Donald Trump wants to tout the new U.S.-Mexico-Canada Agreement with a symbolic signing ceremony ahead of the midterms. But Trump's tariffs on steel and aluminum from Mexico and Canada could derail his plans to have the two neighbors participate in his show. 

Canadian and White House sources told POLITICO there are discussions about inviting Canadian and Mexican officials to an event in an industrial Midwest city. But the Canadians, at least, aren't inclined to help Trump garner favor with voters unless he gives in on the tariffs. 

"There won't be any of that as long as the tariffs are in place," Canadian Ambassador David MacNaughton said. Mexican officials said all options are being considered.

Will they or won't they on quotas? Two senior U.S. officials said there has been discussion about "generous quotas" for Canada and Mexico to replace the duties — 25 percent for steel and 10 percent on aluminum — that went into effect in June. 

MacNaughton declined to say whether Canada would refuse to ultimately sign the deal if the tariffs weren't removed entirely. 

"We just don't think quotas or tariffs make an awful lot of sense between Canada and the United States," MacNaughton said. "That's our position and that's a position we've taken consistently."

Jesús Seade, chief NAFTA negotiator for Mexican President-elect Andrés Manuel López Obrador, told Mexican newspaper Reforma that the new deal should not be signed until Trump eliminates the duties. 

...

TRUMP DRAGS USMCA INTO U.S.-MEXICO BORDER THREATS: Trump hinted on Thursday that he'd be willing to upend the USMCA if Mexico doesn't take steps to block the flow of Honduran migrants making their way northward toward the United States. It's not the first time Trump has sought to link U.S.-Mexico trade with his crackdown on illegal migration. 

"I must, in the strongest of terms, ask Mexico to stop this onslaught - and if unable to do so I will call up the U.S. Military and CLOSE OUR SOUTHERN BORDER!" Trump said in series  <http://go.politicoemail.com/?qs=e33fdc0843778fa6696e153a4a5febb95247e9cf1dffd12ec07bb5cc50360a7115169e2eaa8c263592b8937d630a5799>of tweets. "The assault on our country at our Southern Border, including the Criminal elements and DRUGS pouring in, is far more important to me, as President, than Trade or the USMCA. Hopefully Mexico will stop this onslaught at their Northern Border." 

But Trump backpedaled on his threat Thursday evening, thanking Mexico and retweeting a video of Mexican federal police being deployed to the Mexico-Guatemala border. 

Hardly a new threat: During the 14 months of NAFTA talks, Trump often tied trade and immigration — going as far as to say <http://go.politicoemail.com/?qs=e33fdc0843778fa6915f8e219c7cc7c5aaee6910a734d2648e8f6336cde84d1cb43a6d60c37b05c5e323fa3d3773a00d> Mexico "must stop the big drug and people flows, or I will stop their cash cow, NAFTA." He also suggested <http://go.politicoemail.com/?qs=e33fdc0843778fa6dec2ff7e9a5df79b0dcce2523cbbcd94d0ded85a9b2dc4a32c5f8850a8eb5eacb9ac2f8c2813b5ed> that Mexico would pay for the border wall through a renegotiated NAFTA — a point Mexican officials have long rejected. 

The Mexican government did not directly comment on Trump's tweets, but asked the United Nations Refugee Agency on Thursday to help officials in Honduras, Guatemala, El Salvador and Mexico deal with the caravan of as many as 4,000 Honduran migrants. Secretary of State Mike Pompeo is scheduled to meet outgoing Mexican President Enrique Peña Nieto today. 

AUSTRALIA BECOMES FOURTH COUNTRY TO RATIFY CPTPP: Australia on Wednesday became the fourth country to ratify the Comprehensive and Progressive Agreement for Trans-Pacific Partnership — moving the 11-nation pact one step closer to going into force. Trump pulled the U.S. out of the original TPP at the beginning of his presidency, but the 11 remaining countries went ahead with the deal, which has already been ratified by Mexico, Japan and Singapore. 

The Pacific Rim trade agreement will enter into force 60 days after six countries have ratified the deal. Earlier this week, Canada's House of Commons voted in favor of TPP-11, which must now pass the Canadian Senate. Leaders from the 11 countries have expressed hope that it will be in force by the end of the year. 

IP GROUP: USMCA 'HISTORIC ACHIEVEMENT' ON IP PROTECTIONS: ACTION for Trade, an industry group focused on intellectual property rights and protections, welcomed the new North American trade pact as a "historic achievement" with strong intellectual property protections. 

"The USMCA represents a marked improvement of many of the intellectual property protections critical to innovators in the Trans-Pacific Partnership in important ways," said Brian Pomper, executive director of ACTION for Trade. 

The IP group noted that USMCA includes "tough enforcement penalties to cut down on intellectual property theft" and "new disciplines on anticompetitive behavior and protections for software that will spur creativity and innovation."

Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826

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