US Lists NAFTA Priorities as Renegotiation of the Deal Looms

Mexican President Enrique Peña Nieto and US President Donald Trump shake hands at the G20 Summit in July 2017. Mexico appears to be examining possible revisions to NAFTA ahead of next month's talks

Doing so is a chief goal of President Donald Trump, who routinely said during the campaign that American workers are harmed by foreign trade deals.

The United States on Monday unveiled a tough negotiating strategy for revising the North American Free Trade Agreement (NAFTA), vowing, among other things, to deter currency manipulation by trading partners.

Trump's team believes the trade deficit with Mexico has contributed to a dire scene in US manufacturing towns. The move appeared aimed at future trade deals rather than specifically at Canada and Mexico, which are not considered currency manipulators.

Canadian Minister of Foreign Affairs Chrystia Freeland said the USA list was "part of its internal process" although a source familiar with the Canadian government's thinking said the document was "not earth shattering".

Rep. Grijalva, D-Tucson, also said that protecting agricultural trade in any renegotiated deal is vital, but he went on to say that pushing for worker's rights in both Arizona and Mexico is an important goal.

Dingell in the past has called for US trade deals to contain explicit provisions to deter currency manipulation by trading partners. McSally said Monday that the trade agreement is crucial in Arizona and that she wants to "protect those gains that we've had and also build on them for additional job creation and economic growth".

He said it could be hard to reduce bilateral trade deficits because negotiators had a limited ability to affect the private buying decisions of companies and consumers. "That's more of a macroeconomic issue". Both countries, in addition to the USA, are signors to the 1994 NAFTA trade deal.

Among the priorities, Lighthizer said the administration will seek to eliminate a trade dispute mechanism that has largely prohibited the United States from pursuing anti-dumping and anti-subsidy cases against Canadian and Mexican firms.

They point to sectors like autos, where U.S. inputs make up some 40 percent of the value of products imported into the United States from Mexico, while Chinese exports contain only 4 percent, according to the U.S. Center for Automotive Research.

Among the objectives Lighthizer outlined are reducing the USA trade deficit with NAFTA countries, maintaining reciprocal duty-free market access for industrial goods, and ensuring transparency and accountability in the development and implementation of regulations.

Another objective states the US should be able "to enforce rigorously its trade laws", including the use of certain types of tariffs. It offered no details on such incentives and did not specify how much of a product's components must originate from NAFTA countries.

The document also outlined plans to upgrade standards for labor and the environment and govern digital trade. Canada's trade ministry did not immediately respond to a request for comment.

"We will do everything we can to make this a good agreement and to hold the president at this word and make sure we get a renegotiation", he told a conference call with reporters.

During the campaign, Trump often cited the US trade deficit - $63 billion a year ago - and framed it as an indication of lost jobs and lost money.



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