Government officials from Canada and Mexico slammed the Trump administration's proposals to renegotiate NAFTA in front of the top US trade negotiator on Tuesday. "If we end up not having an agreement, my guess is all three countries would do just fine".
The sources say Canadian negotiators are calling the demand "a non-starter".
"I'm surprised and disappointed by the resistance to change from our negotiating partners", Lighthizer said with Guajardo to his left and Freeland to his right.
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Talks to revise the North American Free Trade Agreement will go into next year amid clashes over how best to change the deal, top officials said Tuesday. The argument is that the USA has many of its own support programs for farmers.
The next round of talks will take place in November in Mexico. TPP is the trade pact that President Donald Trump rejected on his first day of office.
While Mexicans desperately want to keep NAFTA, which has helped transform Mexico into a manufacturing powerhouse and steadily expanded the middle class, they are also making preparations for the possibility of life without it. It governs how much of a vehicle has to be manufactured in North American to avoid import taxes in the three countries that make up NAFTA.
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The Trump administration last week made some tough submissions, included raising the auto rules of origin to 85%, up from the current 62.5%, and adding a sunset clause, which would lead to NAFTA expiring every five years unless all three countries agree to extended it. Lighthizer insisted that 50 percent of all vehicle parts originate from the United States and 85 percent within North America.
He argued that Mexican and Canadian trade negotiators are refusing to accept provisions they have agreed to in the past, including portions of the Trans-Pacific Partnership (TPP) agreement. Canada and Mexico won't stand for it.
"If we do that it's a whole new ballgame going forward and I think there are ways to do that if we have something balanced", he said.
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