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News > Latin America

Mexico, US 'Hours' Away From Reaching NAFTA Agreement

  • Mexico's Economy Minister Ildefonso Guajardo at a news in Mexico City on May 1, 2018.

    Mexico's Economy Minister Ildefonso Guajardo at a news in Mexico City on May 1, 2018. | Photo: Reuters

Published 26 August 2018

After the U.S. Trump administration backed down from its sunset clause, Mexico says the two are close to reaching a deal that still has to pass to Canada.

U.S. and Mexican officials say they are "hours" away from coming to agreements on their portions of the North American Free Trade Agreement (NAFTA) but Canada’s part in the 1994 international agreement won’t likely be squared away until next month.

Trump Calls for Quick NAFTA Deal in Letter to Mexico's AMLO


Mexican Economy Minister Ildefonso Guajardo and chief NAFTA negotiator for his country told reporters on Sunday he was optimistic Mexico and the United States were close to an agreement.

"I would say that we're practically in the final hours of this negotiation," Guajardo told reporters as he headed to a meeting with U.S. NAFTA czar, Robert Lighthizer. However, a few hours later Guajardo said he could not declare victory yet.

It appears that the Donald Trump administration has backed down on its demand for a NAFTA “sunset clause” that would have required a review and rewrite every five years by all three members states of the now 24-year-old pact, according to The Guardian.

Jesus Seade, chief trade negotiator for Mexico’s incoming administration under Andres Manuel Lopez Obrador told reporters, “It’s going to come out. It’s no longer what the United States was putting first in any way,” referring to the once-contentious clause.

Just last week the U.S. government backed down on a crucial agricultural component of the trade deal, agreeing to not press Mexico to restrict its import of some seasonal produce such as tomatoes, avocados, bell peppers, and watermelons, among other fruits and vegetables.  

Now it’s still the automotive industry over which Mexico and the U.S. continue to try and negotiate. According to industry insiders, the two countries are close to agreeing that vehicles produced within the trade bloc contain 75 percent of NAFTA-participant parts, up from 62.5 percent.

The Trump administration initially demanded an 85 percent content requirement, half of which the current U.S. government said must come from the United States, a card that Canada and Mexico roundly rejected.

Trump said on Saturday that Washington could reach an accord with Mexico "soon."

It was Trump who initiated the NAFTA revamp which began more than a year ago. The often contentious talks lulled over the spring until the negotiation pace between Mexico and the U.S. accelerated over the month of August, while Canadian officials have been absent from this round of discussions.

Adam Austen Press Secretary to the Minister of Canada’s Global Affairs told the press last week Canadian NAFTA negotiators, “look forward to continuing these important discussions in the coming weeks."

Three-way talks will likely resume in September, giving Mexico’s incoming president Andres Manuel Lopez Obrador (AMLO), to be inaugurated Dec. 1, Mexico's final say on the long-awaited rewrite because the U.S. Congress still needs 90 days notice to vote on the newest NAFTA draft.

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