Government Affairs

NAFTA Negotiators Work Toward Tentative Deal

Trade representatives of the United States, Canada and Mexico who are renegotiating the chapters of the North American Free Trade Agreement (NAFTA) are working hard to reach at least a tentative agreement in the next week. U.S. Trade Representative Robert Lighthizer, Canadian Foreign Affairs Minister Chrystia Freeland and Mexican Economy Secretary Ildefonso Guajardo concluded the last rounds of discussions on 27 April in Washington, DC. They are scheduled to meet next on 7 May.

How This Will Impact Mobility

Trade agreements have a significant impact on the business relationships between countries and thus the relocation of individuals between not only the countries involved in the agreement but others as well. Depending on the details of a new agreement, companies could make shifts in the locations of their operations and personnel in the U.S., Canada and Mexico and around the globe.

Reuters has reported that Freeland and Guajardo indicated separately to reporters that they thought good progress has been made in the talks on key issues. However, a number of sticking points remain such as the idea raised by Lighthizer to allow one of the countries to withdrawal from NAFTA after three years. While there is no imminent hard deadline in which the negations need to conclude, the talks could be further complicated by the approaching 1 July election in Mexico and the mid-term elections in the U.S. given Congress would need to ratify any new agreement.

Negotiators are working hard to reach a tentative agreement within the next week or shortly thereafter. If the soft deadline is not met, it could takes years for the new terms of NAFTA to be ratified.

President Trump had made the renegotiation of NAFTA a key platform of his presidential campaign. On 2 February, shortly after taking office, President Trump announced his intention to enter into negotiations with Canada and Mexico to revise NAFTA. On 18 May 2017, Lighthizer sent letters to congressional leaders notifying them of the intent of the President to renegotiate the terms of NAFTA. Under the Bipartisan Congressional Trade Priorities and Accountability Act of 2015, the President needs to provide Congress with a 90-day notification before initiating trade negotiations with a country.

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