"For countless Americans, this agreement has failed."
US Trade Representative Robert Lighthizer
NAFTA Press Event, Washington, DC
August 16, 2017
Earlier today, Trade Ministers from Ottawa, Washington, and Mexico City gathered for their first joint appearance at a press event (there was no Q&A period) to launch the NAFTA renegotiations.
The Trade Ministers of Canada and Mexico City gave guarded but optimistic remarks, but the statement by the US Trade Representative Robert Lighthizer, speaking last, was particularly forceful, leaving no uncertainty as to what the US wants from these talks and how they plan to achieve their goals.
His statement was so concise that for purposes of this alert, we choose to have his words speak for themselves, and so we provide here a few direct quotes. In addition to his prepared remarks, Mr. Lighthizer began by saying that he and his colleagues look forward to the talks “over the next several months,” and that this first round would conclude on Sunday, when the dates of the next meetings in Mexico would be announced.
On the scope of the NAFTA talks: “The views of the President about NAFTA, which I completely share, are well known. I want to be clear that he is not interested in a mere tweaking of a few provisions and a couple of updated chapters.”
On US trade deficits: “We have had persistent trade deficits – in the last year totaling nearly $57 billion. In the auto sector alone, the US has a $68 billion deficit with Mexico. Thousands of American factory workers have lost their jobs because of these provisions. In recent years, we have seen some improvement in our trade balance with Canada. But over the last ten years, our deficit in goods has exceeded $365 billion.”
On NAFTA rules of origin and regional value content provisions: “Rules of origin, particularly on autos and auto parts, must require higher NAFTA content and substantial US content.”
On NAFTA enforcement: “[The NAFTA] Country of origin should be verified, not 'deemed.'”
As the NAFTA renegotiations proceed, we will learn more about the specifics to achieve these objectives.
Birgit Matthiesen is Director, North American Automotive at Arent Fox LLP in Washington DC. Her professional career involving trade policy includes her tenure at the Embassy of Canada during the NAFTA negotiation and implementation period. Arent Fox LLP works with a number of companies in North America providing legal and strategic advice in regard to the NAFTA and other US trade agreements.