The United States, Canada and Mexico released a joint statement yesterday after the first round of NAFTA talks, saying they were committed to an “an accelerated and comprehensive negotiation process that will upgrade our agreement and establish 21st century standards to the benefit of our citizens”. The statement also said that the three countries would continue domestic consultations and new rounds of negotiations over the rest of this year.
The move by the three countries is being seen as an effort to reassure businesses that a final deal will be achieved. All three governments involved have said they agree with updates to the deal to take into account technological developments. Big differences remain, however, between the Trump government’s protectionist approach and that of Canada and Mexico. The US also disagrees with mentioning climate change in the deal, something which Justin Trudeau’s Canadian government has said is a priority.
The future of the North American Free Trade Agreement, a trade bloc between the three North American countries established in 1994, became uncertain with the election of Donald Trump as US President. Trump had frequently attacked NAFTA throughout his campaign, saying that trade deficits with Canada and Mexico were unacceptable and threatening to terminate the agreement entirely if its terms did not change to his liking.
The NAFTA renegotiation consequently started on the initiative of the United States, with the US aiming to reduce trade deficits and Canada and Mexico aiming to keep as much of the original agreement as possible whilst modernising the text.