NAFTA negotiations continue to move forward but still far off from reaching a conclusion. The third round of the NAFTA renegotiations has officially started with chief negotiators from the U.S., Canada and Mexico meeting in the Canadian capital. All three countries involved have been working vigorously to come to some kind of agreement in order to keep trade flowing between the nations.
Canada’s chief negotiator, Steve Verhuel, said on Saturday that this round of negotiations is unlikely to bring any U.S. proposal to increase American content requirements for auto’s however U.S. Trade Representative Robert Lighthizer is pushing for an increase. Currently, NAFTA requires vehicles to have at least 62.5% of North American content to qualify for duty-free movement between member nations.
With a deadline set for the end of this calendar year, negotiators are in a hurry to hammer out the details as time begins to run out. NAFTA has been an integral part of trade between Mexico, Canada and the U.S. ever since its inception, however it has faced criticism. The recent presidential campaign focused on NAFTA’s shortcomings and the Trump administration made it clear that they will be addressed.
Follow NAFTA’s Renegotiation
An open line of trade between Mexico, Canada and the U.S. is absolutely vital for all nations involved. Canada makes up the largest market for U.S. steel exports coming in at 48% and they are followed by Mexico at 40% according to the International Trade Administration. Letting NAFTA breakdown and having no plan in place to address trade concerns could have a dramatic impact on U.S. manufacturers in particular.
Nearly every U.S. manufacturing sector has or will at some point do business with Mexico or Canada. Having regulations in place that could fend off trade between the nations could be severely damaging to the nation’s economies. Close consideration and examination of NAFTA is necessary however renegotiations must be as fair as possible. One sided trade deals do a disservice to each individual business entity that relies on the relationship between the U.S. largest trading partners.
Be sure to keep checking back on MFGTalkRadio.com for the latest developments surrounding NAFTA negotiations.