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April 30, 2018

Canadian, Mexican, U.S. Negotiators Claim To Be Closer To NAFTA Agreement, But Will It Pass Congress?

Representatives from the Canadian and Mexican governments remained in Washington over the weekend to continue work on reauthorization of the North American Free Trade Agreement, or NAFTA. Several issues still remain unsettled, however, including auto rules of origin; whether to make compliance with dispute settlement panels voluntary; a potential sunset clause; eliminating investor-state dispute settlement (ISDS); and a proposal to limit the reach of the government procurement chapter, but negotiators have struck an optimistic tone in the last week anyway.

On Friday, Mexican Foreign Minister Luis Videgaray said he thought the three countries were “reasonably close” to a deal while, earlier in the week, Canadian Foreign Minister Chrystia Freeland said, “There is a very strong, very committed, good-faith effort for all three parties to work 24/7 on this and to try and reach an agreement.”

Negotiators left Sunday, but will be back in Washington, D.C. on May 7 to resume discussions.

As Connecting the Dots reported last week, the U.S. Congress still might be the ultimate barrier standing between the North American trading partners and NAFTA reauthorization. The New York Times has reported that both Republicans and Democrats in Congress are skeptical about the Trump administration’s negotiations. To that point: last week more than 60 moderate, pro-free trade members of the U.S. House of Representatives sent a letter to U.S. Trade Representative Robert Lighthizer suggesting that the Trump administration is moving too quickly toward a NAFTA agreement and is focusing on the wrong issues. Because Republicans are also skeptical about the deal, the Trump administration likely would need at least part of this group of Democrats to vote for reauthorization in order for it to earn enough votes to pass the House.

The Metals Service Center Institute (MSCI) continues to encourage its members to discuss their opinions about NAFTA reauthorization with lawmakers. The Canadian government has established a webpage for stakeholders to submit their views. Companies also may submit comments by email (NAFTA-Consultations-ALENA@international.gc.ca) or by mail to: NAFTA Consultations, Global Affairs Canada, Trade Negotiations – North America (TNP), Lester B. Pearson Building, 125 Sussex Drive, Ottawa, ON K1A 0G2.

MSCI members in the United States who are interested in weighing in on NAFTA deliberations should contact their representatives in the U.S. House and Senate to let them know how altering or eliminating NAFTA would affect their businesses, employees, and customers. Click here for contact information for every member of the House and herefor senators.