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Slow and steady NAFTA round 7
Story Date: 3/6/2018
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Source: POLITICO'S MORNING AGRICULTURE, 3/5/18
Negotiators from the U.S., Mexico and Canada will wrap talks to renegotiate NAFTA in Mexico City later today with some progress on lower-level, technical issues.
The discussions were largely overshadowed by an unexpected development - President Donald Trump's announcement late last week that he plans to levy tariffs on steel and aluminum. The threat of tariffs - which the Trump administration said will be formally announced this week - has "taken up a lot of energy" this round, according to several sources. It's also been a quieter round after some of NAFTA's thornier issues - such as auto rules of origin, labor and investor-state dispute settlement - were only briefly discussed at the senior negotiating level.
The three NAFTA trade officials - U.S. Trade Representative Robert Lighthizer, Canadian Foreign Minister Chrystia Freeland and Mexican Economy Minister Ildefonso Guajardo - will sit down this morning for bilateral gatherings and then a trilateral meeting and press conference in the afternoon, where the subject of the steel and aluminum tariffs is expected to come up.
Both Canada and Mexico have argued they should be exempt from these tariffs, but both Commerce Secretary Wilbur Ross and White House trade adviser Peter Navarro said Sunday that it was unlikely Trump would exclude any countries, POLITICO's Doug Palmer and Zachary Warmbrodt report.
Energy gets a spot in the deal: NAFTA 2.0 will include a standalone chapter on energy, a source close to the negotiations confirmed. After Mexico and Canada pressed to have a full chapter on energy, the U.S. has agreed on a chapter that will deal with regulatory cooperation and integration across the region, looking for "more interconnectivity across the networks of energy in North America," the source said.
Anything for aggies, specifically? Talks on agriculture didn't make many waves during this round, but Rep. Sandy Levin reminded Morning Ag that with ongoing U.S. efforts to address dairy restrictions, it's unclear how the chapter will turn out. Issues related to Canadian dairy and softwood lumber "have been going on, and I'm not sure they're going to be resolved in the NAFTA negotiation," Levin told Morning Ag at the tailend of his weekend trip in Mexico City to talk about labor with various Mexican representatives.
What is resolved: Negotiators were able to close the chapter on good regulatory practices, Mexican negotiator Ken Smith Ramos said on Twitter midway through the talks. The chapter "establishes standards never before captured" in a free trade agreement, and that it "promotes transparency in the regulatory process and creates a commitment to promote cooperation," he wrote.
Chapters on food safety and telecommunications also made significant progress. Many involved in the talks say very few outstanding issues remain on both. Roughly half of the chapters are now between 80 and 90 percent, the source said.
What is next: The top NAFTA trade officials will blow past the target date to wrap up talks by the end of March (just in case you thought a NAFTA wrap up was in sight this month).
The eighth round of NAFTA talks are expected to take place in the Washington area sometime in early- to mid-April - but it remains to be seen the details of future meetings as it gets closer to the Mexican presidential election in July and U.S. congressional midterms in November.
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