NAFTA Negotiations Hit a Wall

Negotiations between the US, Mexico, and Canada over reworking the NAFTA trade deal have failed to produce any meaningful results.  Negotiators ended the fifth round of talks on November 21 after failing to reach an agreement on a number of changes being demanded by the Trump administration.  More specifically, Mexico and Canada are rejecting a “US proposal to raise the minimum threshold for autos to 85 percent North American content from 62.5 percent as well as to require half of vehicle content to be from the US.”  The two countries are also resisting US proposals to curb their agricultural production and remove the investor-state-dispute settlement (ISDS) procedure that allows companies to sue countries for alleged discriminatory practices.

“While we have made progress on some of our efforts to modernize NAFTA, I remain concerned about the lack of headway,” said US Trade Representative Robert Lighthizer. “Thus far, we have seen no evidence that Canada or Mexico are willing to seriously engage on provisions that will lead to a rebalanced agreement. Absent rebalancing, we will not reach a satisfactory result,” he added.

VI has joined a chorus of other industry and business groups in calling on the administration to protect ISDS and a number of other important NAFTA provisions, including:

• Ensuring intellectual property is fully protected as in the United States as a protected investment;
• Guaranteeing all sectors are afforded the same protections and access to ISDS to enforce those protections;
• Improving U.S. investment access in Canada and Mexico on a non-discriminatory basis, including by locking in reforms that have opened markets since NAFTA was negotiated;
• Adding stronger disciplines against forced technology transfers and localization;
• Expanding access to ISDS enforcement for breaches of major investment contracts;
• Extending the enforcement period to at least ten years after any potential termination of the agreement, to ensure that American investment is appropriately and fully protected.

Negotiators are expected to meet again in Montreal, Canada from Jan. 23-28 for the sixth round of NAFTA negotiations.

If you’d like to join the VI in our NAFTA advocacy efforts, please email us here.

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