NAFTA talks must involve Mexico, Chrystia Freeland says

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How would renegotiating NAFTA affect Canada? As Ted Chernecki reports, it could be a win for B.C. consumers – Feb 3, 2017

Any talks to renew the North American Free Trade Agreement would involve all three member nations, Foreign Minister Chrystia Freeland said on Tuesday, dampening speculation the United States might seek to sit down with Canada first and then Mexico.

“We very much recognize that NAFTA is a three-nation agreement and were there to be any negotiations, those would be three-way negotiations,” Freeland told a conference on the future of North America.

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U.S. President Donald Trump – who says free trade treaties have cost countless thousands of American jobs – wants NAFTA to be renegotiated with a focus on cutting his country’s large trade deficit with Mexico.

Trump says he needs only to tweak trade ties with Canada, prompting one Canadian official to suggest to a newspaper that Washington would want to negotiate with Ottawa first. Mexico opposes the idea, which trade experts say is almost unworkable.

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“NAFTA is a three-party agreement and any conversation we have regarding that … will be a three-party conversation; it has to be,” Mexican Foreign Minister Luis Videgaray told reporters in Toronto after Freeland’s comments.

Mexican Economy Minister Guajardo Ildefonso earlier told the conference that the bulk of the NAFTA talks would have to be carried out on a trilateral basis to give investors confidence that the same set of investment rules applied everywhere.

READ MORE: Can Donald Trump promise to tweak NAFTA? Trade experts say no

Trump has revealed little about his intentions for NAFTA, which took effect in 1994, except that he wants large changes with Mexico.

The Mexican government expects the talks to start this summer, said Guajardo, who stressed several times how well Canada and Mexico had worked together in the past on trade.

Former Canadian Prime Minister Brian Mulroney, who helped launch the original NAFTA talks, dismissed the idea that Canada might abandon Mexico to its fate.

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“This under-the-bus stuff is for losers, not for winners,” he told the conference.

Freeland noted that Trump’s choices for commerce secretary and trade representative had yet to be confirmed. “We all have to collectively be careful not to get ahead of ourselves,” she said.

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One idea floating in Washington is that of a border tariff, which could hit Mexican exports.

“Nothing in the new NAFTA should be a step backward. We will definitely not include any type of trade management measures, like quotas, or open the Pandora’s box of tariffs,” Guajardo said. “That will be disastrous in any process moving forward.”

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