US and Mexico Near Deal over NAFTA

US and Mexico are coming nearer to an agreement over the NAFTA talks. Read more here!


US and Mexican trade negotiators are near reconciliations over bilateral differences on the North American Free Trade Agreement (NAFTA). They are set to resume talks on Monday, according to Mexican Economy Minister Ildefonso Guajardo.

Prior to that, Guajardo said that the two sides were probably “hours” away from reaching a common position, but in the evening he said there was still much work that needs to be done. The talks would resume on Monday in Washington.

“We’ve continued making progress,” said Guajardo.

The US-Mexico discussions have focused on creating new rules for the automotive industry, which US President Donald Trump has put at the heart of his drive to reupholster the 24-year-old agreement. He has said that the deal has been a “disaster” for American workers.

Canada has sat out of the most recent stage of the year-long discussions, and the moment it rejoined the discussions, the three sides would need to work for at least one more week, said Guajardo.

Mexican Foreign Minister Luis Videgaray stated that Canada would return once the bilateral issues have been resolved, leaving the offices of US Trade Representative Robert Lighthizer late on Sunday.

“But we haven’t finished this stage yet,” he said.


The two side have been slowly closing in on agreements on autos. According to one source that was close to the negotiations, there was not “little” separating the two.

Industry sources believe that they are close to agreeing on raising the regional automotive content threshold for tariff-free access under NAFTA to around 75 percent from 62.5 percent.

Even so, the US administration has been seeking to impose a cap on Mexican car and SUV exports to the United States that could be sent duty-free or at a 2.5 percent tariff, complicating the auto talks, according to three people with knowledge of the matter.

Two automakers state that the United States want Mexican exports of cars and SUVs to be capped at around 2 million units, higher from some 1.77 million exported in 2017, not including pickup trucks.

Including pickups, Mexico exported higher than 2.3 million to the United States last year.

Trump said on Saturday that Washington could be in agreement in Mexico “soon” as the chief trade negotiator of Mexico’s incoming president hinted at potential solutions to energy rules and a contentious US “sunset clause” demand.

Since Mexico’s July 1 presidential vote, the bilateral talks have been complicated by the divisions between the incoming and outgoing Mexican administrations over the energy policy.

The team of leftist Mexican President-elect Andres Manuel Lopez Obrador has resisted enshrining the 2013-14 opening of the oil and gas sector enacted by the now outgoing President Enrique Pena Nieto in the new NAFTA, people with direct knowledge on the matter said.

Jesus Seade, who is the incoming Mexican government’s chief NAFTa negotiatior, said that the issue had been “ironed out” at the NAFTA talks, but he did not disclose any detail. He said this week that it was not “substantive” matter and that Lopez Obrador’s team had wanted to check the terms and see if they were consistent with the Mexican constitution.

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