September 11, 2018 by NADCA in Industry News
There has been a lot of speculation in the press about the U.S.-Mexico agreement in principle reached. They don't have all the parts on paper but got close enough to make an announcement, which brought Canada to the table. Some details may contradict media reports, such as the $90b on products now up to $108b, which is based on intel received in negotiations ongoing since public announcements. Keep in mind the situation is still but below is the summary:
U.S. and Mexico negotiators reached a new NAFTA agreement in principle on August 27 and Canada resumed discussions with officials in Washington on August 28 lasting through the end of August. The U.S. and Canada resumed negotiations on September 5.
The goal is to complete negotiations with final text by the end of September, allowing at least the Presidents of the U.S. and Mexico, and hopefully Prime Minister of Canada, to sign the agreement no later than November 29 (within sixty days of completion on September 30). The deadlines are driven by two key actions – a new President of Mexico being sworn in on December 1, who will take a harder line in negotiations with the U.S. The second is a 2015 U.S. law formerly known as Fast Track now called Trade Promotion Authority allowing the expedited review by Congress of a trade agreement without amendments and with only an up or down vote. Once President Trump formally notified Congress of his intention to sign, it triggered a ninety-day clock expiring November 29.
NAFTA 2.0 faces three major tests in order for a new agreement to take effect:
1. Canada and the U.S. address outstanding issues, all three parties able to sign by Nov. 29;
2. Timeline to draft text, issue reports, identify changes in law needed, introduce implementing bill;
3. Securing the votes in either a Democratic or GOP held Congress in 2019.