Lighthizer: U.S. Won't Bother Waiting for Canada on New NAFTA Pact

Matt Posky
by Matt Posky

U.S. Trade Representative Robert Lighthizer has said the United States will begin moving forward on its bilateral trade deal with Mexico at the risk of leaving Canada behind.

The nation was already given until the end of September to reach an agreement that would effectively maintain the existence North American Free Trade Agreement, but has not indicated satisfaction with the current terms. Unfortunately, the U.S. wants to ensure a deal is in place before the next Mexican president assumes office — giving it precious little time to spend on Canada after the last year’s worth of negotiations proved ineffective.

“If we push it beyond [October 1st], then we have a new negotiation with Lopez Obrador and we don’t know where that would go at all,” Lighthizer said. “It would be unfair to all the people that have been involved — certainly the U.S. workers, farmers and ranchers — to start a new negotiation with a new president of Mexico.”

As unfair as it might be to Canada, the new timeline was established specifically so current Mexican President Enrique Pena Nieto could sign the trade deal before he leaves office on November 30th.

While we’ve previously covered Canada’s issues with the automotive angle of this particular trade deal (it doesn’t want tariffs), Bloomberg reports that the major sticking points revolve around dumping and dairy. The United States and Canada are at odds over anti-dumping dispute panels, contained under Chapter 19 of the current deal, which the U.S. wants to remove and Canada wants to keep in place. Another major qualm revolves around Canada’s protected dairy industry. While it isn’t mentioned in the latest draft of the deal, the U.S. has repeatedly asked for its northern neighbor to make concessions.

Ideally, the U.S. would like to see a three-way pact signed. This has left United States agreeable to a future where Canada joins an established pact with Mexico later on, Lighthizer explained. However, he also noted that the U.S. and Canada are still quite a way away from having a genuine agreement. “I think Canada would like to be in the agreement, I think the U.S. would like them in the agreement but there’s still a fair amount of distance between us,” Lighthizer said. “There are very large issues, issues of dairy and Chapter 19, a number of significant issues between us.”

Meanwhile, Canadian Prime Minister Justin Trudeau commented on the growing trade tensions alongside his foreign minister, Chrystia Freeland, who is heading NAFTA talks. Trudeau said that, while the deal between the U.S. and Mexico raises the possibility of Canada signing, he’s committed to standing up for Canadian interests in negotiations. Freeland declined to comment specifically on Chapter 19, saying only that “rule of law is an extremely important part of how we do things, including trade.”

Lighthizer says that, regardless of how the final deal looks, the NAFTA name is likely dead. Donald Trump hopes to use the term “U.S.-Mexico-Canada pact,” or USMC (an acronym the Marine Corps already uses), according to the Trade Representative.

[Image: Fiat Chrysler Automobiles]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • TCragg TCragg on Sep 26, 2018

    I have to say that the preceding comments by all involved are among the most civil, accurate presentations of facts that I have seen thus far on the NAFTA debate. Thank-you.

  • TrailerTrash TrailerTrash on Sep 26, 2018

    i will also add that what trump is trying to do still has many hurdles. for instance, there are legal jumps he has to make. not sure if you can just stop the current agreement without congress getting involved. and this is exactly what canada and china might be playing here...for the post nov elections and the next congress. not saying trump will not win, but it will take some time and work. and canada needs to understand the usa will under trump fight for a better deal. and get one. however, it has been started and can be fixed...if all side start listening and participating.

  • Analoggrotto I am sick and tired of every little Hyundai Kia Genesis flaw being blown out of proportion. Why doesn't TTAC talk about the Tundra iForce Max problems, Toyota V35A engine problems or the Lexus 500H Hybrid problems? Here's why: education. Most of America is illiterate, as are the people who bash Hyundai Kia Genesis. Surveys conducted by credible sources have observed a high concentration of Hyundai Kia Genesis models at elite ivy league universities, you know those places where students earn degrees which earn more than $100K per year? Get with the program TTAC.
  • Analoggrotto NoooooooO!
  • Ted “the model is going to be almost 4 inches longer and 2 inches wider than its predecessor”Size matters. In this case there is 6” too much.
  • JMII Despite our past experience with Volvo my wife wants an EX30 badly. Small, upscale, minimalist EV hatch is basically her perfect vehicle.
  • Dukeisduke Is the Volvo EX30 even on sale yet? It was pulled from the NACTOY awards because they were having software problems with the vehicle.
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