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NAFTA Talks Encroaching on Congressional Deadline
18 May 2018, 04:15 | Devin Moran
Lighthizer Said to Be Pessimistic on Meeting Nafta Deadline
Among the issues that still require political will to resolve, the main ones are automotive rules of origin that lower the amount of foreign-made parts allowed in vehicles manufactured in North America; the inclusion of a so-called sunset clause that would allow the deal to automatically terminate every five years, unless the parties agree to keep it going; and agricultural seasonality clauses that would effectively cap fruit and vegetable exports, all proposed by Washington. He doesn't oppose a NAFTA renegotiation on principle, because he knows the loss would harm Mexico's economy far more than that of the US or Canada.
Ryan's comments indicated that the law known as the Trade Promotion Authority provides for "fast-tracking" passage of a trade agreement negotiated by the administration by putting the deal to an up-or-down vote without amendment.
US officials say the talks need to wrap up very soon to give the current Congress time to vote on a final text for a revamped North American Free Trade Agreement.
"As the author of TPA, we have to have the paper - not just an agreement".
The bill lays out a number of negotiating objectives required by Congress and mandates that the deal be notified to Congress 90 calendar days before the executive branch signs the agreement.
"I'm fearful that if we miss this deadline, it's at earliest going to be a year-end event", he said.
The lack of an agreement doesn't mean the NAFTA talks are dead - Mexico and Canada have downplayed the need to reach a deal this week, with negotiators saying a series of challenges remain after about nine months of formal discussions.
A Canadian official, speaking on condition of anonymity, said it will be up to Trump to decide whether he wanted a compromise deal now, or if he'd rather hold out for the hope of something better in the next Congress.
If no deal has been agreed upon before December when he will potentially take office if he wins the election, he is likely to replace the entire Mexican negotiating panel - and sending the entire process into reverse - the pact that has governed cross-border trade since 1994 will be way back up in the air once again and that is bearish for both the Loonie and the Mexican peso.
President Donald Trump wants a NAFTA deal done soon. That could further complicate talks.
Democratic Rep. Rosa DeLauro of CT on Wednesday urged negotiators to continue their talks, saying Ryan's deadline is arbitrary.
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