<html><head><meta http-equiv="Content-Type" content="text/html charset=utf-8"></head><body style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space;" class="">INSIDE US TRADE<div class=""><br class=""></div><div class=""><h1 class="title" style="font-family: Tahoma;"><font size="5" class="">Business groups form coalition to urge protection of NAFTA, oppose some U.S. proposals</font></h1><h1 class="title" style="font-family: Tahoma;"><font size="5" class=""><font size="3" class="">October 19, 2017 </font></font></h1><div class="body" style="font-family: Tahoma; font-size: 13px;"><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">Several U.S. business groups have formed an informal coalition to collectively lobby for the preservation of NAFTA and oppose a series of proposals put forward by the U.S. during the negotiations.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">The U.S. Chamber of Commerce, the Coalition of Services Industries, the National Foreign Trade Council, the American Farm Bureau Federation and the U.S. Council for International Business are among those leading the effort.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">The group met with about two-thirds of House members last week, according to U.S. Chamber of Commerce Senior Vice President for International Policy John Murphy. Sources said the group is expected to hold a lobbying day for the Senate on Oct. 24.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">“We need to make our voices heard. We need for the administration to understand that [withdrawing from NAFTA] would be very costly,” Murphy said during a Tuesday panel at CSI's Global Services Summit.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">CSI President Christine Bliss, at the same panel, said the coalition was formed to make sure the administration focuses on modernizing NAFTA rather than negotiating a “NAFTA minus.” But some U.S. proposals are inconsistent with that vision, she said.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">For instance, a “one for one” proposal for government procurement advanced by the U.S. puts at risk a U.S. financial services sector that insures three out of four of Mexico's federal employees, she said. A withdrawal from NAFTA could have even more dire consequences because Mexico is not a member of the World Trade Organization's Government Procurement Agreement, therefore giving the U.S. no guaranteed procurement market access, Bliss said.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">Murphy said a Canadian negotiator called the U.S. procurement proposal “the worst trade proposal in the history of trade proposals.”</font></div><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">Along with procurement, business leaders disparaged U.S. proposals to tighten NAFTA's auto rule of origin, implement a five-year sunset clause, and opt-in or out of the investor-state dispute settlement mechanism.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">These so-called “poison pills” are holding hostage proposals that would serve to update the agreement, Murphy said. According to Murphy, a Canadian negotiator told him this week that Canada would be prepared to discuss certain U.S. offensive interests, but has taken them off the table because of they are beset by the U.S.' “backward proposals.” Murphy said these proposals have the business community “genuinely concerned” the U.S. is on a course to NAFTA withdrawal.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">The poison pills, according to Murphy, have been rejected by the business community, were opposed by some during the interagency process, are opposed by members of Congress and are being rejected by Canada and Mexico.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">“You can see why we're concerned that this leads to an impasse and some higher possibility of collapse of the negotiations,” he said.</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">A spokeswoman for the Office of the U.S. Trade Representative, responding to similar criticisms lobbed by Murphy, said earlier this month </font><a href="https://insidetrade.com/node/160563" class=""><font size="3" class="">the administration expected pushback</font></a><font size="3" class=""> on proposals from “entrenched lobbyists” wary of “draining the swamp."</font></div><p style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class=""></font> </p><div style="margin-bottom: 0px; margin-top: 0px;" class=""><font size="3" class="">Former USTR Michael Froman </font><a href="https://insidetrade.com/node/160672" class=""><font size="3" class="">this week criticized</font></a><font size="3" class=""> the business community for not being vocal enough about the dangers of withdrawing from NAFTA. -- <em class="">Brett Fortnam</em>(</font><a href="mailto:bfortnam@iwpnews.com" class=""><font size="3" class="">bfortnam@iwpnews.com</font></a><font size="3" class="">)</font></div></div><p style="margin-bottom: 0px; margin-top: 0px; font-family: Tahoma; font-size: 13px;" class=""> </p></div></body></html>