U.S. worried Ontario, Quebec, Mexico elections could stall NAFTA talks

Click to play video: 'Lighthizer says Mexico, Ontario, Quebec, U.S. midterm elections could cause ‘political headwinds’ to NAFTA negotiations'
Lighthizer says Mexico, Ontario, Quebec, U.S. midterm elections could cause ‘political headwinds’ to NAFTA negotiations
WATCH ABOVE: Lighthizer says Mexico, Ontario, Quebec, U.S. midterm elections could cause 'political headwinds' to NAFTA negotiations – Mar 5, 2018

The United States says it’s in a hurry to finish NAFTA negotiations quickly, arguing that political challenges over the coming months will make it increasingly difficult to complete an agreement if talks drag on.

It says it’s prepared to split the talks into separate bilateral negotiations with Canada and Mexico if it fails in the short term to achieve its primary objective which is a three-party agreement.

READ MORE: Donald Trump warns Canada won’t get a break on steel tariffs without ‘fair’ NAFTA deal

U.S. trade czar Robert Lighthizer listed three sets of elections later this year as a reason to hurry: the Mexican presidential vote in July, American midterms in November, and provincial campaign in Ontario and Quebec.

WATCH: Freeland says tariffs, NAFTA are “quite separate” issues, despite Trump’s tweet

Click to play video: 'Freeland says tariffs and NAFTA are “quite separate” issues, despite Trump’s tweet'
Freeland says tariffs and NAFTA are “quite separate” issues, despite Trump’s tweet

He also referred obliquely to a fourth concern looming in the political backdrop. For months, Republicans in Washington have been quietly expressing fear that their party will lose seats in Congress, or perhaps even lose power entirely, resulting in a more protectionist, progressive legislature with the ability to block any ratification vote.

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Lighthizer didn’t put it that explicitly. But for the first time he made public his hope of renegotiating NAFTA, completing the legally required consultations, and proceeding to a ratification vote before a new Congress gets sworn in next January.

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READ MORE: Why NAFTA doesn’t protect Canada from Trump’s decision

That would mean completing the deal within weeks. American trade law requires a six-month consultation period with congressional committees as one of several processes before any final vote.

“Now our time is running very short,” he said at an event to close a round of talks in Mexico City, standing beside his colleagues Chrystia Freeland and Ildefonso Guajardo.

“All of this complicates our work. I fear that the longer we proceed the more political headwinds we will feel… We must resolve our outstanding issues soon to maintain the possibility of having this measure be considered by the current Congress.”

Click to play video: 'Freeland in Mexico for NAFTA talks while aluminum tariffs loom over Canada'
Freeland in Mexico for NAFTA talks while aluminum tariffs loom over Canada

He said he’s willing to ramp up the pace of talks to make it happen – to work continuously to achieve a breakthrough, he said. He listed the major U.S. priorities as new rules for auto parts, more Buy American-friendly public procurement policies, and provisions that keep jobs on American soil.

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And there’s something else he’s willing to do: split negotiations in three.

READ MORE: Justin Trudeau says tariff move by Trump ‘makes no sense,’ adds he spoke with president

Lighthizer made public remarks that appeared to confirm something he allegedly told members of Congress behind closed doors a few weeks ago – leaving a meeting, they said he’d described the negotiations with Canada as more difficult, and was willing to complete talks with Mexico first.

“We would prefer a three-way, tripartite agreement,” Lighthizer said Monday.

“If that proves impossible, we are prepared to move on a bilateral basis if agreement can be made.”

He expressed frustration that only six chapters have been completed so far – with three more at this round. There are potentially up to 30 to conclude, including a newly announced energy chapter designed to lock in Mexico’s privatization reforms.

A new complication has landed on the table over the past week: a heated dispute over steel and aluminum tariffs. U.S. President Donald Trump insisted Monday that he remains 100 per cent committed to imposing tariffs, but could remove them on Canada and Mexico if there’s a NAFTA deal.

The pending announcement has Europe, Mexico, and Canada all threatening retaliation, and trade analysts fearing an escalating tit-for-tat that undermines the global rules-based system.

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“We will always stand up for Canadian workers and Canadian industries,” Freeland said Monday.

“Should restrictions be imposed on Canadian steel and aluminum products, Canada will take appropriate responsive measures to defend our trade interests, and our workers.”

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