Depending on whom you listen to, talks to renew the North American Free Trade Agreement are moving at “warp speed” or are “dragging.”
Negotiators from the United States and Mexico came north this week to talk with their Canadian counterparts. The talks are going on in a atmosphere of heightened anxiety as American President Donald Trump and his top trade officials use aggressive language and bluster not usually associated with these types of international discussions.
But while the president’s tweets capture the headlines, bureaucrats and professional negotiators wading deep into the details do the real work behind the scenes.
The meeting this week was the third session of an expected seven round process that is planned to wind up by December.
U.S. Trade Representative Robert Lighthizer said the previous two rounds of negotiations had accomplished much and were moving at warp speed.
Word from the Canadian camp is less enthusiastic, and news reports say they are awaiting specific American proposals on several key issues, leading to a CBC headline that the talks are dragging.
However, Canadian negotiators also say the talks are constructive.
Some key issues of contention that have come to light are the binational panels under the agreement’s dispute settlement process as well as country-of-origin content in auto trade. Trump wants the panels in the dispute settlement system eliminated and rules requiring more U.S. content in vehicles.
The dispute settlement process found in Chapter 19 of the agreement is very important. Back when the pact was originally negotiated, then Prime Minister Brian Mulroney threatened to pull out if it was not included.
Of course, Canadian farmers are keenly interested in what will happen with this country’s supply management system.
But as this column was written, that issue had not yet been addressed in the talks.
Until specifics are known, it is hard to know whether the talks will result in proposals that are modest or momentous.
But it is worrisome that the Trump administration is approaching this process with a mindset that trade is a zero sum game — that any advantage one partner gains must be loss for the others.
The original agreement was based upon the idea that improved trade could be the rising tide that lifts all boats.
It is not a case of one country stealing jobs from another. Rather, the whole NAFTA region benefits from more efficient supply chains and economies of scale that help all of North America compete against the rest of the world.
It is frustrating not to know the specifics of what is being worked out, but negotiators can’t make headway if every issue becomes a matter of drawn out public debate.
Whatever the result, much is at stake. In agriculture, trade within NAFTA is huge.
In 2016, Canada exported $22.5 billion of agrifood products to the United States and imported $24.7 billion for a trade deficit of $2.2 billion, according to data from Agriculture Canada.
Agrifood trade between Canada and United States has tripled in the 23 years that NAFTA has been in place.
Our food trade with Mexico is much smaller but still important.
We exported $1.73 billion and imported $2.44 billion.