LONDON, MEXICO CITY
Britain could join the North American Free Trade Agreement (Nafta) if it doesn’t get a post-Brexit trade deal with the European Union, the Daily Telegraph newspaper reported on Tuesday.
The newspaper said ministers were looking at the idea as part of planning for the possibility of Britain not managing to negotiate a trade deal with the EU as part of its Brexit divorce.
US Chamber warns
Separately, the US Chamber of Commerce urged the Trump administration on Tuesday to moderate its stance in the renegotiation of the Nafta, describing some of Washington’s demands as “poison pill proposals” that could doom the talks.
Thomas Donohue, the chamber’s president and chief executive, will raise a red flag about the progress of the negotiations, according to advance excerpts of a speech he was due to make in Mexico City on Tuesday morning.
The group has argued repeatedly in recent weeks that Nafta is critical to US industries such as agriculture and manufacturing.
“There are several poison pill proposals still on the table that could doom the entire deal,” Donohue said in remarks to be delivered at an event hosted by AmCham Mexico. “All of these proposals are unnecessary and unacceptable.” The US Chamber did not specify what the most contentious proposals were in the excerpts of the speech, but a number of thorny issues have been highlighted by the Mexican and Canadian governments and the US private sector in recent weeks.
These include US exploration of imposing national content requirements for some products, not just regional thresholds, within certain sectors of industry, such as carmaking.
Automakers in Mexico say excessive content requirements could do serious damage to the industry’s competitiveness.
In addition, US officials have mooted incorporating a sunset clause in Nafta that would kill it unless it was renegotiated every five years, as well as eliminating a key dispute resolution mechanism, much to the dismay of Canada.
The US, Mexico and Canada began renegotiating the 23-year-old trade pact this summer, with a fourth round of talks kicking off this week in Washington.
US President Donald Trump has threatened to withdraw from Nafta if he does not win concessions to reduce a US trade deficit of around $64 billion with Mexico.
But the US Chamber of Commerce has consistently stressed the pact’s importance.
BOX — Canada’s Trudeau to tell Trump: we’re not your problem at Nafta
OTTAWA
When Canadian Prime Minister Justin Trudeau meets President Donald Trump on Wednesday, he will try to persuade the US leader to focus on Mexico as a source of potential problems at talks to update Nafta.
Although Trudeau officials were confident Trump would mostly target Mexico as the three nations started to renegotiate the North American Free Trade Agreement, Washington has slapped duties on Canadian Bombardier airliners and lumber exports in recent months.
Foreign Minister Chrystia Freeland said Trudeau would “explain really clearly to the President ... that Canada is not America’s problem”.
Canada has so far shunned confrontation with Washington, stressing instead the merits of Nafta and free trade. By no means everyone south of the border is convinced. Chris Sands, a professor at the Nitze School of Advanced International Studies at Johns Hopkins University, said Canada’s problems marked “a new era of tough love” with Washington. “It turns out Trump is an economic nationalist ... and it’s come as a bit of a surprise to the Canadians that they have been so much on the hot seat,” he said.
-Reuters
