What Happens if the U.S. Fails to Strike NAFTA 2.0 Deal?

Leaders from Canada, Mexico and the United States are meeting in Washington, D.C. to kick off round 4 of the North American Free Trade Agreement (NAFTA) talks Wednesday. As the trade talks come full circle, convening back in Washington after kicking off there, many ag leaders are growing impatient with the slow progress being the product of the first three rounds. National Association of Wheat Growers (NAWG) CEO Chandler Goule is pressing the current administration on why so much time is spent on renegotiating current deals- instead of focusing on ways to bolster trade through new agreements. “USTR has limited resources,” said Goule. “It’s time to get past plowing the same fields and start opening ground in new markets. Right now, we are standing around watching the world pass us by on trade agreements.” Pursuing new markets is the focus of a new campaign. “Farmers for Free Trade” is a recently launched campaign, chaired by former Senators Max Baucus (D-Montana) and Richard Lugar (R-Ind.), to drum up local support for trade. American Farm Bureau Federation (AFBF) is joining the campaign this week, making it clear a bipartisan effort is the only route to build trade. While the Trump administration says creating bilateral deals is a focus, it’s reworking current deals that the administration thinks will reduce the current trade deficit, declaring a tough stance on trade deals like NAFTA...more

NAFTA negotiators notch a chapter, set up fourth round of talks for October

Top trade negotiators from the U.S., Canada and Mexico said Wednesday they have one chapter of an updated North American Free Trade Agreement (NAFTA) in the books. U.S. Trade Representative Robert Lighthizer, Canadian Foreign Affairs Minister Chrystia Freeland and Mexican Secretary of the Economy Ildefonso Guajardo said they have completed the chapter on small- and medium-sized enterprises in remarks at the end of the third round of NAFTA talks in Ottawa. Lighthizer called it “very, very important” that the chapter is done. “These businesses are the engines that drive each of our economies,” Lighthizer said in his closing remarks. Lighthizer said that significant progress is being made in other areas, including competition policy, digital trade, state-owned enterprises, sanitary and phytosanitary measures, customs and telecommunications...more

Trump stands tough on Mexico ahead of NAFTA renegotiation

By Robert Romano

We are still more than two months away from the much-anticipated renegotiation on NAFTA starting on August 16 by the Trump administration, but the opening round has already occurred, resulting in a June 6 settlement by the U.S. Commerce Department with Mexico over that country’s dumping of government-subsidized sugar on U.S. markets.

Under the settlement, according to the statement from Commerce Department Secretary Wilbur Ross, “We have gotten the Mexican side to agree to nearly every request made by U.S. industry to address flaws in the current system and ensure fair treatment of American sugar growers and refiners.”

The agreement increases the price at which raw and refined sugar must be sold at the mill in Mexico, from 22.25 cents per pound to 23 cents per pound and from 26 cents per pound to 28 cents per pound, respectively, excluding packaging and transportation. Also, the percent of refined sugar that may be imported to the U.S. has been reduced from 53 percent to 30 percent.

Significantly, according to the Commerce Department, the U.S. reserves the right to enforce U.S. law and institute further sanctions should the sugar dumping continue: “Mexico agreed to increased enforcement measures and to accept significant penalties for violations, including a reduction in the amount of sugar allowed to be imported equal to twice the amount of any sugar found to be in violation of the modified agreements.  In addition, Commerce can increase this reduction to three times the amount if necessary to deter further wrongdoing.”

Like any negotiation, there was give and take. In exchange, the U.S. agreed to give Mexico “a right of first refusal to supply 100 percent of any ‘additional need’ for sugar identified by USDA after April 1 of each year.” According to the department, additional need is defined as “demand for sugar in excess of the demand USDA had predicted for that crop year.”

In a statement issued by the American Sugar Alliance, the industry expressed concerns that this particular concession contained a major loophole which might enable Mexican sugar dumping to continue and is continuing talks with the administration to tighten up the language of the agreement.
Still, on the surface, the situation appears to be better than it was, validating the tough position Trump is taking on trade with Mexico — and Canada, for that matter — ahead of the NAFTA renegotiation.

READ ENTIRE POST 

 

Canada, Mexico ready to talk about NAFTA with U.S.

Canada and Mexico agreed Thursday to U.S. President-elect Donald Trump’s demand to have a fresh look at their tripartite 22-year-old free trade pact, fearing they could be shut out of the US market. But the two U.S. allies diverged on the level of changes to the North American Free Trade Agreement (NAFTA) each was willing to accept, with Mexico taking a harder line. The 1994 trade pact became a source of friction with America’s neighbors during the campaign when Trump called NAFTA the worst trade deal the United States has ever signed...more