A tougher stance by US at NAFTA talks

New proposals unlikely to find support with either Mexico or Canada

The United States has adopted a tougher stance in NAFTA renegotiation talks, a move that could be designed to prevent a new deal being reached, according to a report by Bloomberg.

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Based on information provided by officials familiar with the discussions on the North American Free Trade Agreement, the report says that proposals being pushed by the U.S. on government procurement, textiles and fresh produce are unlikely to be agreed upon by either the Mexican or Canadian governments.

The third round of talks held in Ottawa, Canada, this week took on a more negative tone than previous rounds held in Washington and Mexico City, the officials said.

The U.S. seeks to limit government contracts that Mexican and Canadian companies can access in its domestic market, proposes ending preferential tariffs on textiles and is pushing to open seasonal products such as fruit to dispute mechanisms that would likely raise tariffs and hinder Mexican exports.

Two of the sources Bloomberg spoke to said the move could be a deliberate ploy to make settlement on a new agreement impossible.

That stance fits with the hardline rhetoric of President Donald Trump who has made repeated threats to pull out of the deal if it wasn’t renegotiated in a way that is more favorable to the U.S.

Reducing its U.S. $64-billion trade deficit with Mexico has been a priority in the renegotiation process with automotive manufacturing seen as the biggest cause of the imbalance.

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Consequently, at the next round scheduled for October 11 to 15 in Washington, the U.S. is expected to once again push its contentious proposal to change rules of origin in the sector.

The United States wants cars to have higher NAFTA country and U.S.-specific content in order to get tariff-free status in the North American market. That proposal is almost certain to be rejected by Mexico and Canada, further raising the possibility that the talks will end in stalemate.

U.S. Trade Representative Robert Lighthizer told reporters Wednesday that “significant progress continues to be made” in some areas including digital trade and telecommunications but “there is an enormous amount of work to be done, including on some very difficult and contentious issues.”

All three countries previously agreed it was important to accelerate the pace of talks with a view to concluding them before domestic political matters, including next year’s Mexican presidential elections, took over.  However, a lack of consensus on several issues could make that goal increasingly difficult to achieve.

If any of the three countries decided to withdraw from the talks and agreement, six months’ notice is required although legal battles would likely follow, especially if it was the U.S. pulling out.

But at the end of this week’s talks, Mexican Economy Secretary Ildefonso Guajardo said he remained confident that progress can still be made.

“As the negotiations move forward it is important we have the will to table positions that encourage constructive discussions.”

Source: Bloomberg (en)

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  • Mike S

    Nobody initially thought the “Brain Stem With an Orange Comb Over” would be stupid enough to pull out of the Paris Accords but he did. The US trade problem is with China not Mexico. Mexicans buy lots of US products- the Chinese don’t. China is a competitive military expanding empire. Mexico has been a tried and true ally. We have $550 billion in trade between our two countries. Without Mexican car plants, South Korea and China will eventually do in our auto companies. NAFTA is a powerful trade block that keeps north America competitive with Asia and Europe. Trump may know how to run beauty pageants & celebrity gold tournaments and how to sue his way to great wealth, but he knows little about international trade unless there is something in for him personally- like borrowing $400 million from the Chinese National Bank or making sure Ivanka’s Chinese sweat shops are not disturbed. If Trump revokes NAFTA, both countries will slide into major economic recessions. Mexico will find other investors and markets in Europe, Asia, and Latin America. The US can’t do that.

    • BUCEPHALUS

      China opened a Trade Office in the D.F. In January. They will be happy to step in when the U.S. backs out of NAFTA. Trans Pacific trading with Mexico, Central and South America is a key goal of the Chinese Government. Donald Trump should tread carefully and not play into the hands of China like he will when he signs the Tariff against imported Solar panels and Modules. He has already given China a Golden Ticket by leaving the Paris Accord. He has opted to get out of the way instead of lead.

      • From South of the Border

        Are you kidding? If you think Mexican wages are low Chinese wages are even lower and companies will start moving out of Mexico to China.. Then who will buy things here in Mexico. By the way Trump is leading, I’m sorry that you don’t understand economics , but maybe you should read my other entries above to learn how restoring jobs is more important than the phony “Global warming ie Climate Change ie what is the next phony excuse!!” It is refreshing when someone cares more for people and families than they do for political correctness and the newest leftist political scam.. Next year they’ll tell us something else to be afraid of!! Time to create jobs and save people money by lowering taxes. Let the scumbag leftists spout their left wing drivel no one is listening in America anymore. Their to busy going back to work and making money and enjoying life again with money in their pockets. Isn’t it a shame no one cares about the latest leftist scam!! TO BAD!! NOT!!

        • BUCEPHALUS

          Actually, Chinese wages have climbed in the last ten years. Henceforth the reason they have opened factories in Vietnam and other southeast Asian countries. As for Trump leading, not really. He tells the base what they want to hear then works to put into place policies that benifit his equals financially. Bringing back labor from china can only be accomplished by paying a low wage. So much for good paying jobs. Unions have been vilified as some leftist conspiracy even though the modern benifits, such as the 40 hour workweek, enjoyed by workers in the country can all be directly attributed to union membership over the past several decades. As for climate change, the entire United States military would beg to differ with you on the scope and importance of this phenomenon. They have identified it as the number one threat to their mission of defending the country. Your bias is readily appearant, so please keep your response based in fact, not Kool-Aid.

          • From South of the Border

            First of all I was comparing wages in China vs. Vietnam, I was comparing wages in China vs. Mexico. Secondly your bias is also, readily apparent look who is calling who a Kool Aid drinker. First the military came out with so called “Climate Change,Global Warming” as the number one threat during Obama’s administration with a gun cocked and loaded aimed at them! Ask any of the Generals today now that the leftist is out of the White House they’d laugh at you. My brother is a Colonel who works at the Pentagon he is still laughing every time a lefty brings up that bogus statement of the military when Obama was in the White House. The military doesn’t concern itself with threats so called that it as a fighting force can’t do anything about. Talk about a KOOL AID drinker!!
            Creating jobs is easy, if you know what your doing! It isn’t so easy when your main objective is to put middle class workers into welfare so that you and the government can control their lives, instead of them working and making a living. I the last 8 months look at the employment figures for the mining industry especially for coal and iron ore mining the employment figures are staggering since the beginning of February, 2017 till now more than 250,000 plus jobs have been created simply by getting rid of the job killing regulations that had killed Americas mining industry. The average iron ore, coal and other mining jobs have an average pay of $60,000 a year. This provides a livable wage for the average family. You talk a good game about giving people good jobs, but what about these 250,000 plus people with children. The unions are beginning to cheer Trump, because of such job creation as in the mining industry during construction the Keystone and Dakota access pipelines 10,000 jobs created so far estimates are 42,000 jobs during full construction 12,000 to 15,000 full time jobs after they are built. You see actions speak louder than words. People will vote with their pocketbooks and bank accounts, not with ideology.
            You calling me a Kool Aid drinker is like the stove calling the kettle black. Yes, The unions in the 1930’s, 40’s 50’s and 60’s brought about the minimum wage the 40 hour work week etc, etc. The funniest thing is go and talk to the UAW, Teamsters, Miners and other unions they are clapping and supporting a lot of Trump’s policies, because they see results not promises never kept. How about the poster girl for factory mines closing back last year Hillary Clinton tells a group of union miners she is going to close the mines they work in and she was a champion of unionized workers give me a break. One of these days you leftists otherwise known as the people who love to talk a great game about creating jobs, but in reality are actually great job destroyers and killers instead.
            You asked for facts not KOOL AID, well here are the facts and of course you will make up excuses why these facts aren’t facts. Just remember people vote their wallets first and that will mean TRUMP in 2020 winning a second term. I can hardly wait to say I told you so!!

  • From South of the Border

    Mike S. and Bucephalus, Both of you seem to forget something most of the major economic trading partners are having similar problems with China and its trade practices. The U.S is the largest market for autos and related products in the world. Countries like Japan and others will not allow the U.S. market to fall to China. Both of you seem to believe that its the U.S. that needs both China and Mexico not the other way around. What happens to China, if it has to find a trading partner or partners who can absorb all the products that China sells to the U.S. that is impossible there is no other market in the world that could absorb that huge an amount of exports. Even, if China used several different markets at the same time the huge export market that China has in the U.S. can’t be replaced. Huge unemployment in China starts the ball rolling toward internal unrest something the Chinese leadership has avoided until now, because they have used the huge export surplus to keep the gravy train rolling, a huge drop in employment means many more Chinese needing help from the government which already is struggling to import water to use to run its industry and feed the thirst of its growing population. That is the fist time bomb. Time bomb number two the unchecked health catastrophe called the water and air pollution crisis that has yet to be tackled by the Chinese government. Cancer rates in China’s top 10 cities are 9 times higher than in the U.S.’s top 10 cities. The World Health Organization backed up by the U.S. centers for disease control says that it will take a multi-decade effort and a fiscal investment of 6 to 7 trillion dollars to clean up China’s air and water. This estimate is good only, if the Chinese government starts now, if they wait the cost will escalate out of control. This is China’s second time bomb after the first being keeping the Chinese people employed in order to pay for the economic growth and to pay for increasing imports of food and water. Most of China’s fresh water has been compromised which is driving the water imports. The food imports are driven by the growth of China’s population you need the surplus of trade with the U.S. to help pay for the food and water. You also, need the surplus to help China pay for the environmental clean up. So it is actually the U.S. that holds the whip handle with China.
    If the trade issue is settled with China the issues with Mexico are not as urgent, but again remember most of the U.S. domestic car market comes still from Detroit and from Japanese cars made in states like California and Tennessee and other southern states. Mexico in the end needs NAFTA more than the U.S. does I’m a language teacher I teach over 100 students a week who work in auto related companies no NAFTA those jobs disappear rather quickly and many of the factories in the industrial zones of SLP, Queretaro etc. would close giving the Mexican government a fiscal and economic mess on its hands that would be monumental in size. The U.S. has its problems, but compared to China and Mexico they can be managed the situations in China and Mexico would be very difficult, if not impossible to handle especially in China.
    I haven’t the time Mike S. to effectively destroy your ideas right now about the absurd Paris Accords, but I’ll leave you with this since January 20, 2017 over 200,000 plus jobs have been created in the mining sector in the U.S. average salary $50,000 plus a year most of the mining minerals including coal is being sold overseas. Unemployment real unemployment not the phony numbers given by the Obama White House, but real jobs at high wages like mining and construction such as the Keystone pipeline new factories going up in Ohio and Michigan and 3 new steel mills opening next month near Pittsburgh real jobs with an average middle class salary of $55,000 plus a year.S0 take the Paris Accords and use them as scratch paper useless as the day is long.
    Ideology is a poor excuse given to families looking for jobs and a decent way of life. Just watch the ” Brain Stem with an Orange Comb Over” will be reelected, because of these new jobs being created in the Midwest Rustbelt and in other parts of the U.S. his military build up will create thousands of new jobs. Shipbuilding jobs on average pay $60,000 to $65,000 a year build 110 new ships for the Navy long term employment for electricians, steel workers etc. Make fun of the “Orange hair Comb Over” all you want the U.S. has already created 1.45 million Jobs since January of this year with an average salary of between $55,000 and $60,000 a year. Mike S. the comb over is looking at practical results not ideology that is based on a foundation of quicksand. Results not theory will keep the comb over in the White House. A person will overlook most things as long as they have money in the bank and in their pocket and a roof over their head and their families heads. In January of 2021 the comb over will show that results will always overcome ideology and fantasy.

    • Happy Girl

      “So it is actually the U.S. that holds the whip handle with China.” Delusional much??? China has loaned the USA so much money the USA would go bankrupt if China called in their loans. The USA doesn’t make anything anymore and if China stopped doing business with the USA it would be a mass disaster that would take years to fix. The Chinese don’t think like Americans…you do know they are communists, right? They are a very proud people and you don’t want to get on their bad side.

      • From South of the Border

        Happy Girl, I would beg to differ the loans are actually a weapon that can be used against China. First though you never replied to any of my points usual way to lose a debate. Secondly have you ever heard the saying, if you owe the bank a few thousand they own you, but if you owe them billions you are partners. China can’t afford to lose the money they have lent to the U.S. it would hurt them badly and by the way instead of buying from China India could replace China. Maybe you should study up on the subject a bit, before coming up with a rather lamb posting. Next time address my points, if you can!!

    • Mike S

      I DID state that China is the problem causing major trade deficits and they buy few US made goods. Just the opposite with Mx. Six million high paid US jobs depend on trade with Mx. There are three times as many US jobs in alternate/renewable energy as in coal. The few new coal jobs since 2017 are only because coal exports are up slightly. There is NO boom in high paid coal mining jobs in the US despite the lies Trump spouts. 2017 will go down as fewer overall jobs created than 2016. GDP will be about the same. Destroying the EPA to facilitate mining jobs is short-term profits for long-term problems. These mining companies must be made to clean up after their operations.
      China is a member of the Paris Accords and is moving rapidly into solar and other cleaner alternative energy power sources while the US under Trump gets left behind. If you don’t think South Korea and China are going to be confronting US auto makers in near future, you are dreaming. We need NAFTA. Trump will not be re-elected. Are you a member of Fox Nation and a graduate of Trump University?? WE are headed for massive deficits if Trump gets his tax breaks for himself and the mega-wealthy. During “good” times deficits should shrink like they did drastically between 2013 and 2016.

      • From South of the Border

        Mike S. You did say China was the problem, but with few details. Its funny how you skip over the environmental problems in China which you think solar will solve, please. China has been increasing its coal and oil imports by between 15% to 18% a year for the last 10 years so much for solar which is a fantasy which all left wingers have been hanging their hat on since Jimmy Carter’s time believe me I’m old enough to remember the smiling incompetent. When your born in 1959 you cover a lot of territory such as you pooh-pooh tax cuts well they have worked, before I don’t know how old you are but in the last half of the 20th century 2 presidents one a democrat and another republican used almost the same level of tax cuts and they helped to ignite the 60’s and 80’s economic booms. Keep on ignoring history when it doesn’t ring true to your ideology you’ll be looking at something close maybe not as bad, but close to a 1984 blowout.
        The Paris Accords like all Global Cold then when that didn’t work now its Global Warming then that didn’t ring true now its Climate Change a bunch of bull from the beginning and I’m glad the president sees it for what it is. You disregard 200,000 plus jobs in mining. For you it might be foolish, but for 200,000 plus families with children earning $60,000 a year is better than earning 20 or 25 thousand dollars a year. By the way I haven’t watched fox news for several years and If you read my age above you’ll get that degrading my education is quite beside the point just so you know I’m a graduate of the University of Massachusetts with 2 BA degrees one in History the Education and I hold a masters degree in Education as well. You see Mike S. I don’t belittle people I just write the facts to the best of my knowledge after doing my own research. I don’t read from the ideological talking points issued this week from whichever political party happens to be the flavor of the month. Deficits should go down during good times, but look at the 10 plus trillion your brilliant economic illiterate president imposed on the American people from 10 trillion in January 2009 to 20 trillion plus in January 2017 quite a deficit reducer when the deficits add 10 trillion in 8 years and it took the other 43 presidents 200 plus years to add the first 10 trillion to the nations debt. Please learn something about history, before taking on someone who knows a bit more than you do especially cover my points and don’t just dismiss them out of hand and how about caring about people such as 200,000 plus families with much higher incomes and money in the bank this coming Christmas versus last Christmas. I know people don’t count with left wingers just amorphous ideology that doesn’t jive with the facts.

  • Güerito

    In Mexico, $2 per hour workers make $40,000 SUVs:

    “The premise of the auto industry since the times of Henry Ford was that workers would make enough to buy the cars they produced. Across the U.S. and Europe, the arrival of an auto plant meant the creation of middle-class communities, with employees taking vacations, buying homes, cars, perhaps even cottages and boats.

    But in Mexico — where the auto industry has boomed under the North American Free Trade Agreement, with plants like the Audi factory that opened in Puebla state in 2016 — the industry has created something different: a class of workers who are barely getting by, crammed into tiny 500-square-foot apartments in government-subsidized projects that they pay for over decades. Many can’t afford even a used car, taking home as little as $50 per week after deductions for mortgages and cafeteria meals.

    Why have Mexican auto salaries stagnated or declined while pay for Chinese auto workers rose, despite all the promises that North American Free Trade Agreement would increase Mexican wages? That’s the question U.S. negotiators are asking as the third round of NAFTA talks resumes in Ottawa, Canada.

    Ironically, U.S. President Donald Trump, widely seen here as one of Mexico’s worst enemies, is pressing the issue of low Mexican wage rates, saying labor protections should be strengthened.

    “It’s ironic, right, that he’s always criticizing us, but at the same time, he could do something that benefits us, by exposing the rot in the system” said Audi worker Eduardo Badillo, 34.

    The key, in Mexico’s auto industry, may be the so-called “protection” contracts signed long before plants open.

    Alex Covarrubias, a labor professor at Mexico’s Sonora College, said such “protection” contracts are almost universal in Mexico. “Almost all the (labor) contracts that are signed in Mexico are unlawful, which means that they are company contracts, which the workers aren’t aware of.”

    Critics have long accused Mexican unions of doing more to control workers than represent them. The country’s biggest labor federation forms part of the ruling Institutional Revolutionary Party.”

    http://abcnews.go.com/International/wireStory/mexico-hour-workers-make-40000-suvs-50081342

    • From South of the Border

      Hi Gueritos, Great response. People here in Mexico might actually like Trump by the time the NAFTA talks are over with forced higher wages. Mexico and the Mexican people aren’t the problem its the whole ruling class in Mexico from the political parties to the so called unions here. If the Mexican government wants to keep NAFTA they are going to have to increase the minimum wage per day by a big amount or NAFTA goes away.

      • Güerito

        The worst enemy of the average Mexican is Mexico”s corrupt ruling class.

        • From South of the Border

          You are completely correct.. The ruling class here in Mexico would look nice hanging from trees, if the Mexican people would just hang a few things might change..for the better..

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