If Mexico, the U.S. and Canada don't renegotiate the North American Free Trade Agreement in two months, Washington might put the talks on the back burner until after a new Mexican president is elected or takes office, U.S. trade representative Robert Lighthizer said Monday.
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He spoke after the seventh round of renegotiation talks wrapped up in Mexico City with little progress reported.
"The window is fairly short. It's not like we can do this in my judgment, at the end of May and think we can get anything done," Lighthizer said. "It's not irrational to think you would have lower speed talks at some point, just to keep the talks going ... and wait until after the elections," referring to Mexico's July 1 presidential election.
"The question is: 'Til when? When do you start up — after the election, or do you start up after the new president is in place and has his own people in place," Lighthizer said.
He said the latest talks produced agreement on only three of the 27 remaining NAFTA chapters, including health and sanitation, transparency and regulatory practices.
Lighthizer said progress had been slower than hoped, and noted it might be harder to get any deal through the U.S. Congress after November.
"There is some possibility that the Democrats will take over the Congress, and even if that doesn't happen, they'll be a different makeup of Congress for sure," he said.
Since renegotiations began, agreement has been reached on only six of NAFTA's 30 chapters, and big differences remain on issues like regional and U.S. content in autos, and dispute resolution panels.
The U.S. threw a new issue into the talks when President Donald Trump announced new duties on aluminum and steel imports — but then said Mexico and Canada would be exempted from the tariffs if NAFTA were successfully renegotiated.
Lighthizer denied that was a strong-arm tactic meant to exert additional pressure on Canada and Mexico.
"This is just a total coincidence," he said regarding the timing of the new tariffs.
Nor was it a threat, Lighthizer said. "I certainly presented it as a positive thing ... It's my view that it's an incentive to get a deal."
Lighthizer said that "at this point our objective is still to have a trilateral agreement," but noted that the Trump administration is "prepared to move on a bilateral basis" with either Canada or Mexico.