Trudeau fights to save NAFTA deal, but Trump offers little hope

STEPHEN CROWLEY  NYT

STEPHEN CROWLEY NYT

"It's possible we won't be able to reach a deal with one or the other, but in the meantime we'll make a deal with one". A further pronunciation this week both muddied the waters and yet hinted as Trump's end-game. "If the agreement dies overnight, this is going to have an impact on the daily lives of a lot of people, because all of a sudden there's going to be a scarcity of nearly everything that we consume in Mexico-especially on foodstuffs", says the former office head for S&P's Global Ratings in Mexico City.

Does he really think terminating the agreement will lead to a better one?

A "sunset clause" that would automatically terminate the agreement in five years unless all sides support its continuance.

WASHINGTON-Progressive House Democrats and their union allies campaigned against retaining a secret "trade court" in any "new NAFTA".

So the administration has been seeking to ensure that more auto production be made in America to receive NAFTA benefits, that more government contracts in the NAFTA bloc go to US companies and that NAFTA expire unless the countries agreed every few years to extend it. Others at the panel were also unable to offer a prediction.

Blowing up the deal appears to be Trump's favored choice.

One of the most contentious US proposals is around so-called rules of origin for vehicles, which govern what share of a auto must be built within NAFTA countries to receive the pact's benefits. For its part, Mexico has been sending signals that is getting close to simply walking away from talks. "Nafta has benefited millions of people and can benefit millions more", Trudeau said, although he added that Nafta could use a "much-needed upgrade". According to reports by Canadian media, Prime Minister Trudeau told President Trump behind closed doors that his preferred option was to modernize the continental accord. He said Canada's military would seek alternatives to Boeing for future fighter-jet purchases.

"He views it as a violation of US sovereignty", she added. Delta Chief Executive Ed Bastian called the tariff "nonsensical" and said the carrier simply wouldn't pay it.

Britain, whose regulation has been within the EU's orbit for over 40 years, would also have to shift towards the North American model for services, goods, competition policy and data protection.

"He made it clear they don't want to pull out".

NAFTA's death is not yet set in stone. "We have always understood that draining the swamp would be controversial in Washington". Experts are at odds over whether the president could unilaterally kill NAFTA. Some believe that since Congress approved the first Free Trade Agreement in 1993, it would have to pass a law to rescind NAFTA.

The Chamber estimates that about 14m USA jobs depend on trade with Canada and Mexico, and more than $1bn in commerce is conducted daily across the southern and northern borders. "But it is our responsibility as a government to prepare for every eventuality, and that is what we are doing".

That bodes well for a country that for too long has found it easy to ride on the coattails of its big neighbour to the south.

Instead, companies may ship in more products from low-priced countries outside the region, paying US tariffs ranging from 2.5 to 5.0 percent.

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