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Optimism over NAFTA Emerges


Under the backdrop of the successive tariff announcements indicating a potential trade conflict between the U.S. and China, it appears that the Administration wishes to expedite NAFTA negotiations. U.S. Trade Representative Robert Lightizer met with the Foreign Minister of Canada, Chrystia Freeland and the Economics Minister of Mexico, Ildefonso Guajardo last week to discuss items of concern before the Eighth Round which commenced on Friday April 6.  Freeland indicated that the three countries are making “good progress”.  Canadian Prime Minister Justin Trudeau noted that talks “are moving forward in a significant way” according to Bloomberg. It is understood that the White House wishes to conclude negotiations on NAFTA and will retract from absolute demands relating to automobiles and a sunset clause.



A jarring note is represented by the decision of the White House to deploy troops to sections of the common border with Mexico. All four candidates for the July presidential election in Mexico have condemned the use of U.S. military although there is precedent for this action.  Mexican President Pena Nieto stated, “The U.S. and Mexico have an intense dynamic relationship but this does not justify threatening or disrespectful attitudes between our countries”.



Progress on NAFTA and overtures to the EU in some measure reduce anxiety in Midwestern states where concern is evident over the prospect of retaliatory tariffs threatened by China. This follows successive reciprocal announcements on tariffs on imported steel, aluminum and threats relating to imposition of import duties on a wide range of consumer items from China, announced by the President during the first week of April.