Vicente Fox: Mexico, China could strike trade deal if US leaves NAFTA

By White HouseFOXBusiness

Trump's push to renegotiate NAFTA ahead of Mexican election

Hayman Capital Management CIO Kyle Bass on the Trump administration's trade talks with China and efforts to renegotiate NAFTA and the outlook for Tesla.

As negotiators struggle to meet a U.S. congressional deadline of Thursday for a North American Free Trade Agreement revision, Mexico has been working on a “Plan B” that doesn’t involve the U.S., according to former Mexican President Vicente Fox.

Continue Reading Below

Because of the stymied progress and President Donald Trump’s threat to withdraw from the trade agreement, Mexico has started looking elsewhere for trade opportunities – particularly to China.

“We're already working with China,” Fox told FOX Business. “I’m coming to China in a month from now … I think that we can put a deal together – China and Mexico – that will replace NAFTA."

So far, a NAFTA deal has eluded negotiators from the U.S., Canada and Mexico. Key areas of concern include auto manufactures and U.S. demands for a sunset clause that would limit the length of a new deal to five years.

Trump slammed Mexico yet again on Wednesday, while speaking at a roundtable event with California officials who oppose the state’s sanctuary city policies.

“Mexico talks, but they do nothing for us,” Trump said at the White House event. “Especially at the border. Certainly don’t help us much on trade.”

U.S. House Speaker Paul Ryan said Congress won’t be able to vote on NAFTA changes if it’s not notified of a deal by May 17.

Fox said that the best option “by far” is for Mexico to continue working within the framework of NAFTA.

As Trump remains critical of Mexico, the country has begun to look elsewhere for certain products.

Mexico has been the top importer of U.S. corn for years and the second-largest purchaser of America’s soybeans, but it has recently turned to South American sellers such as Brazil and Argentina as well as working to increase Mexico’s own supply. Mexico bought 584,000 metric tons of corn from Brazil last year – a 970% spike over 2016, Reuters reported.

“We just cannot sit down and wait for [Trump] to destroy us,” Fox said.

More on this...

Fox, who served as Mexico’s president from 2000 to 2006, added that the onus isn’t only on the U.S. He said Mexico, too, has work to do, including raising employee wages.

The former Mexican president said NAFTA is more than just a trade agreement.

“It brings to the United States the competitiveness that [it] has lost and that will be the path to the future,” Fox said. “[The] United States needs that competitiveness, and it comes with associating with alliances.”

What do you think?

Click the button below to comment on this article.