US tentative on NAFTA 2.0 talk with Canada, Mexico

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Negotiators from Canada, Mexico and the US kicked off the first round of trade talks on Wednesday, trying to fast-track a deal to modernize the North American Free Trade Agreement (NAFTA) by early next year.

The renegotiation had a rocky start since the Trump administration of the US earlier lectured Canada and Mexico on the “failures” of the current agreement, and began to seek significant concessions from them.

Gary Hufbauer, a senior fellow at Peterson Institute for International Economics said at CGTN’s The Point that 60-billion trade deficit of the US with Mexico per year tops President Donald Trump’s failures reference.

Gary Hufbauer /CGTN Photo

He noted that Trump’s administration is also concerned about NAFTA’s certain provisions, including arbitration reviews of anti-dumping and countervailing duty cases which Trump and his associates believe to erode US’ sovereignty.

Apart from such “bad idea” in the pact, Canada and Mexico are not poised to liberalize their markets for US goods and services, which hampers the US manufacturing sector and job market, Hufbauer added.

Despite NAFTA’s unpopularity in the US, Trump, however, decided to get the US back to the renegotiation table due to some pressure from the establishment and leaders from Canada and Mexico, said Colin Robertson, vice president of Canadian Global Affairs Institute.

Hufbauer agreed that Trump would not leave the NAFTA since many Congress members are strongly against withdrawal.

Different from the US, the NAFTA has been widely supported by political parties and the public in Canada, though bumps in the negotiation may occur, said Robertson.

He doubted that the US trade concerns and the election agenda both in Mexico and the US this year would allow a new deal signed within this year, but insists his optimism about an update of the NAFTA.

The Point with Liu Xin is a 30-minute current affairs program on CGTN. It airs weekdays at 9.30 p.m. BJT (1330GMT), with rebroadcasts at 5.30 a.m. (2130GMT) and 10.30 a.m (0230GMT).