Everyone within the closed circuit of North American Free Trade Agreement (NAFTA) negotiators participating in Round 3 at Ottawa expect that Tuesday and Wednesday the United States will finally unveil its demands of the issues of Rules of Origin and Chapter 19.
Last Friday there was a prelude that it may happen these two days from U.S. Commerce Secretary Wilbur Ross and U.S. Trade Representative coordinator John Melle, saying that it would be in this round that the United States wants to tackle what it deems the spiny issues.
For Secretary Ross, there is no question as to the fact that the United States wants to increase original parts made in USA to North American vehicles as a way to diminish the trade deficit it has with Mexico. As usual, Ross used catastrophic language to blame Mexico of the deficit as “they have stripped the manufacturing industry finishing off jobs and sacking our wealth.” Wow!!! Come on, Wilbur!
With this prelude to the presentation of whatever U.S. negotiators come up with today, both Canada and Mexico have stayed mum and should be waiting for whatever bait comes at the hook of the reel the United States will toss. To bite or not to bite is the question, and of course, the question being asked by Mexico’s Economy Secretary Ildefonso Guajardo is if this is the best way to help cut down on the U.S. deficit with Mexico.
A separate issue is the much discussed elimination of Chapter 19 which imposes a five-member panel to oversee negotiations and keeps them out of U.S. courts where Canada and Mexico feel they are going to get biased treatment. Both say no to doing-away with this chapter.
News about the first three days are of enthusiasm and still commenting on how the organizer of Round 3 caused minor scorching among the visitors who had to be located in many different hotels around Ottawa, including some in Gatineau, Quebec just across the river.
The Canadian hosts are said to have used yellow school buses to transport the throngs of usually upper lipped negotiators who are used to moving around towns by limo. And for a top noon meal, they were handed over boxed lunches.
Other than that, the negotiators are doing what they went for and still trying to come up with definite text in several of the issues that have already been agreed upon by the end of Round 3 late Wednesday. Nevertheless the real issue is what good these finished chapters will serve if the real stumbling bloc on Rules of Origin is not settled ahead of the rest.
Despite expectations because of the rush to negotiate the whole NAFTA enchilada by year’s end and the possible presentation by USTR Robert Lighthizer of their Rules of Origin, propositions chief Canadian negotiator Steve Verheul is confident that the United States will not present either dispute settlements: the dairy sector (very important for Canada) and the North American content in vehicles.
It must be made clear that these suppositions or rules of origin and dispute settlements stem from two issues: the view made public by Secretary Ross, as well as the fact that Mexico is in a hurry to conclude the deal.
Verheul told journalists over the weekend that “they are not expecting that” from the U.S. side. Yet news agency Reuters claims that Rules of Origin will be discussed today and tomorrow.
Yet time flies and the three nations have only programmed seven rounds of negotiations which means they will have to start delivering finished agreements as of now.
Incidentally, both Canada and the United States claim they are not in a hurry and would like to take longer on discussing Rules of Origin and trade dispute settlements longer.
If there’s a rush, it is because Mexico is imposing it. We’ll see what the next two days bring about as for sure by Thursday there will be a statement of achievements by the three top negotiators in which for sure we’ll know what went on Tuesday and Wednesday.
