Push for NAFTA deal continues as uncertainty increases

With the future of the North American Free Trade Agreement (NAFTA) up in the air, business groups, Democrats and Republicans are urging congressional leaders and the Trump administration to press on toward a deal.

Despite efforts to wrap up work on NAFTA, negotiators with the United States, Canada and Mexico have yet to reach a deal on updating the 24-year-old agreement, with no end in sight.

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The Trump administration had hoped to move quickly to update the three-nation pact, but after nine months — talks first started in August — a final deal remains elusive between the longtime trading partners.

Last week, Speaker Paul Ryan (R-Wis.) said he would likely need a deal on Capitol Hill by Thursday so lawmakers would have enough time under fast-track rules to ratify an new agreement during this Congress.

On Thursday, Ryan said that it might be possible within the trade promotion authority framework to find some “wiggle room” to push an agreement through Congress this year. But without a deal, he said that prospect remains tough to gauge because time is short. 

On Thursday night, U.S. Trade Representative Robert Lighthizer put out a straightforward statement saying that the three countries “are nowhere near close to a deal,” generating more uncertainty amid what has been weeks of intense negotiations.

His statement came after Canadian Prime Minister Justin Trudeau suggested earlier in the day that the three nations were inching toward an agreement, and Mexican officials sounded a more pessimistic tone about the chances a deal would be done in the near-term. 

Lighthizer said there are still ”gaping differences on intellectual property, agricultural market access, de minimis levels, energy, labor, rules of origin, geographical indications and much more” but that the U.S. would remained engaged in the talks.

On Friday, House Ways and Means Committee ranking member Richard Neal (D-Mass.) and Trade Subcommittee ranking member Bill Pascrell (D-N.J.) called on Ryan to clarify what steps he intends the House to take on NAFTA for the remainder of this Congress.

“Noting that in the last 24 hours, you moved the goal posts on your own deadline by a seemingly arbitrary two weeks, at this juncture, we write to ask you, as the author of [the Trade Priorities and Accountability Act], what happens now?” the lawmakers wrote in a letter to Ryan.

Neal and Pascrell argue that the current NAFTA “fails to reflect the economy of today.”

“We cannot afford to sit back and be satisfied with the status quo,” they wrote.

“We, and the American people, await your answers eagerly.”

Meanwhile, Republicans in Congress are urging the Trump administration to reach an agreement that retains dispute settlement rules and rejects a U.S.-proposed five-year sunset clause, both issues that have raised concerns among GOP lawmakers and U.S. businesses.

House Ways and Means Committee Chairman Kevin Brady (R-Texas) said Friday that it is important that the United States, Canada and Mexico stay at the table to negotiate a new and modernized NAFTA.

“I hope all countries continue working in good faith to get this done, whether that means a vote in Congress this year or next,” Brady said.

Brady said the U.S. wants “an agreement that creates certainty for American workers and companies and high-standard rules that don’t automatically sunset after five years.”

Business groups have regularly reminded Lighthizer and President Trump what a new NAFTA will need to include to gain their support.  

The Business Roundtable said in a statement on Friday that “whether or not all three nations can come to an agreement in the coming days or weeks should not drive us away from the goal of preserving and strengthening NAFTA’s benefits to create more economic opportunities for U.S. businesses and workers.”

The group, which represents the nation’s top CEOs, argued that the White House’s primary objective should be avoiding any policies that would restrict trade.

“Proposals that would weaken investor-state or state-to-state dispute settlement mechanisms, implement overly restrictive rules of origin requirements, institute a sunset clause or curtail government procurement opportunities would create uncertainty for U.S. businesses and should be rejected,” the Business Roundtable said.