NAFTA Update: Nobody Has Any Idea What's Going On

Matt Posky
by Matt Posky
nafta update nobody has any idea whats going on

In case you haven’t kept up with the coverage on the renegotiation of the North American Free Trade Agreement, things haven’t gone well. Despite wrapping the latest round of talks in Washington on Friday, negotiators have made no clear progress on updating the trade deal. Considering a new deal is supposed to be finalized by the end of March, it’s beginning to look as if the NAFTA revamp might be doomed.

The biggest issue crippling the talks continues to be regional-content requirements for cars to qualify for NAFTA benefits. Both Mexico and Canada have described the U.S. content proposals as “unworkable.”

“People have to be planning for what they do in a worst-case scenario,” Robert Holleyman, a partner at Crowell & Moring and the former deputy U.S. Trade Representative under Barack Obama, told Bloomberg. “At the same time, I’ve never seen industry more involved across all sectors in making the case that the U.S. needs to come out with a NAFTA that allows all three countries to declare victory.”

The United States is dead-set on narrowing trade gaps, especially with Mexico, and sees the content origin requirements as an essential part of ensuring a more equitable exchange. President Trump has said he would withdraw the U.S. from the agreement entirely if the gap in trade was not fixed.

Republican lawmakers, including Senators John Cornyn and Ted Cruz, have asked Trump not to abandon NAFTA as Democratic representatives have requested protection for U.S. workers. However, whether either side has the ability to actually stop him from leaving the accord is unknown. “History suggests it would be very challenging for Congress to muster the will and the energy to forcefully counter that,” mused Holleyman.

However, with no real progress made, it’s becoming increasingly difficult to envision a different outcome. The United States doesn’t seem interested in softening its demands and has been critical of Mexico and Canada for not participating earnestly. During the previous round of ineffectual discourse in Mexico, U.S. Trade Representative Robert Lighthizer explained his goal was to “rebalance” trade on the continent and requested that Mexico and Canada begin engaging in a “serious way.”

The next round of talks will take place in Montreal from January 23rd to the 28th. They are likely to become the defining moments for NAFTA’s future.

[Image: NAFTA Secretariat]

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  • T.W T.W on Dec 18, 2017

    Late to the party as usual but it must be said. The Americans negotiating tactic is 'You'll swallow what we give you to swallow and you will like it' and then have a fit because Canada and Mexico aren't eagerly pulling down their pants for their prize. Can't even provide some Vaseline to ease the pain, just shut up and smile, we have a political base to pander to. This is not negotiating, it's a series of poison pills they know will be rejected and a FU pay me tactic. The POTUS is not a negotiator, he just plays one on TV and bilateral agreements while the orange one is in charge is lunacy.

  • Lostjr Lostjr on Dec 20, 2017

    Did the Auto Pact go away after NAFTA, or is it still in the background?

  • Dukeisduke This would be a nice car. I've long been a fan of the W123 series cars - and one of my favorite colors for these. This would be the injected (D-Jetronic?) 2.8l inline six.Was the cloth always purple like this, or is it age that turns it purple?
  • NotMyCircusNotMyMonkeys nobodys mentioned free HD radio?
  • ChristianWimmer I am a huge W123 fan but I never liked the square headlights on the 280/280E/280C/280CE models and later on the post-1983 entry-level models. The W123s always looked right with the circular headlights.This is a great car, though. But 230C/CE & 280C/CE are so common here - I want a US-spec 300CD Diesel or 300CD Turbodiesel because that would be an exotic here in Germany.
  • NotMyCircusNotMyMonkeys not a single word on whether this grey market would even pass smog or be driveable in the state.
  • MaintenanceCosts Gorgeous, even if the W124 coupe is even better. Too bad about that paint color, though.