On the same day the United States announced it would end exemptions of steel and aluminum tariffs for Mexico and Canada, NAFTA leaders say their countries are still committed to completing the North American Free Trade Agreement renegotiations.
Kenneth Smith, who heads NAFTA negotiations on behalf of the Mexican Ministry of Economy, along with Lawrence MacAulay, Canada’s minister of Agriculture and Agri-Food and Sonny Perdue, U.S. agriculture secretary, addressed the World Meat Congress in Dallas on Thursday. The event is hosted by the U.S. Meat Export Federation and the International Meat Secretariat.
Perdue says trade is critically important to U.S. farmers and ranchers, and he understands the current trade climate is causing anxiety for U.S. farmers “It is an anxious time. It is legitimate anxiety placed in a situation of low commodity prices already. We can’t afford trade disruptions,” he says.
Mexico and Canada consider the recent steel and aluminum tariffs a separate trade issue that will be addressed outside of NAFTA.
Canada’s MacAulay says NAFTA has been very beneficial for the agricultural sectors of all three countries.
“We are reevaluating NAFTA. I think this is the 11th or 12th time we have done that. It is not a new thing to do,” notes MacAulay. “I never met anybody that doesn’t think NAFTA is vitally important to the agriculture sector. Representing agriculture in my country, it would be pretty wise that I promote NAFTA and come up with a deal that’s even better.”
Smith says the negotiations have made 70-75% progress in many areas since the talks began last August. “We still have tougher issues that are being discussed at the ministerial level and issues the U.S. has put on the table on automobile rules of origin, dispute settlement and a sunset clause. These are, by nature, difficult types of negotiations on these issues and they will go until the end,” he states.
Perdue says he is hopeful agreement can be reached on a revised NAFTA this year, but conceded there are hurdles ahead, including July elections in Mexico and the fall U.S. midterm elections.
Mexico will elect a new president in July. Smith shares how the election could impact the NAFTA negotiations.
He explains, “There are several scenarios. One is we conclude before the transition of power. We conclude negotiation and the new administration decides if that package is satisfactory and take it to the Mexican Senate for approval or if we have finished the negotiation then it will be up to the new administration to continue where we left off on June 30.”
Smith reiterates that complex trade negotiations take time and will finish when all three sides reach a favorable agreement.
“We will continue negotiating as long as it takes. We will not rush,” stresses Smith. “Regardless of the political process in Mexico or the election in November, we will continue to negotiate and close only when Mexican priorities have been addressed.”