No deal is good news.
As the second round of the renegotiations of the North American Free Trade Agreement (NAFTA) in Mexico City came to a close Tuesday, the top negotiators for Canada, the United States and Mexico issued a joint statement that it was still very early for any results in the 25 chapters under discussion.
The best part of the renegotiations came from the White House as President Donald Trump did not tweet anything against the agreement, because previously Mexican Foreign Relations Secretary Luis Videgaray’s visit to Washington — after Trump tweeted two threats against NAFTA — forced the intervention of his son-in-law and “shadow diplomat,” Jared Kushner, into the negotiations, who assured that talks would go well. Kushner has been a key to holding the negotiations together.
This does not mean that the other shadow, that of Trump, was not present as United States Trade Representative Robert Lighthizer at a press conference said he is working for President Trump and stated:
“I hope that when this agreement is over, the president will support it, because I will not approve anything he does not endorse.”
Nevertheless, Lighthizer’s intervention was described as “softer and more cordial” than the position he showed during the first round in Washington where he emphasized the United States had agreed to renegotiate because several manufacturing sectors had suffered damage particularly from Mexican competition. Lighthizer, however, in a closing statement repeated “we want to benefit workers but not at the expense of others.”
Mexico representative and Economy Secretary Ildefonso Guajardo, however, said that the five days the second round lasted were carried out intensively “with the ambition to start closing deals” and that at least seven of the 25 chapters at hand had been “identified” and put into coherent text.
In fact, Guajardo said that in the upcoming third round to be held in Ottawa from September 23 to 27, there could be some real results and even definite drafts in some of the discussed chapters.
“This will not mean the seven chapters will be done deals in Canada” but that was the agreement reached with Canada’s top negotiator Chrystia Freeland and Lighthizer. “It will serve as parting point for the first accords of the renegotiation.”
In terms of the themes themselves, he hinted — remember this is all secret until it is final — that some of the “early crop” agreements will be in telecommunications, small business and trade facilitation. Energy will apparently be another easy chapter and it has to be decided if it becomes a chapter or a side “transversal” agreement.
Guajardo said that at this point of the discussions the U.S. Trade Representative has not raised difficult issues, such as how to reduce trade deficits and rules of origin referring to national content, particularly pertaining to the auto manufacturing industry.
Another issue that was not brought up either was the U.S. attempt to disappear Chapter 19 that deals with resolution of controversies as well as one of Canada’s main complaints that refers to the existence of low wages in Mexico which are not even close to those paid in the United States and Canada.
Positions on these issues, and perhaps why they are being postponed for future rounds, as Guajardo put it, are “totally clashing” among the three nations, “but we may start talking about them in the third round.”
About the only thing for sure came from Chrystia Freeland who made a point in saying that “this is a speedy and integral negotiation. I am here to tell you all [journalists] that the three partners are committed in these discussions in a constructive way.”
In their trilateral statement Freeland, Lightizer and Guajardo committed themselves to comply “with our shared objective of concluding the process towards the end of this year.”
So at the end of two rounds of dealings, the least that can be said is that renegotiations have been intensive and even productive in terms of advancement at least in some of the less spiny issues that promise to be heated, but by then, negotiators will know each other well with perhaps a solid outcome.
What has been achieved is indeed good news.