Initial NAFTA Discussions Focused on 'Easier Things,' Commerce Secretary Says
Commerce Secretary Wilbur Ross during a Sept. 8 event said the administration’s strategy through the first two rounds of NAFTA renegotiations has been to address “some of the easier things” with Canada and Mexico. That helps to build momentum and a “feeling of togetherness” before moving on to the handful of “really key” issues of the deal, Ross said during an event hosted by The Washington Post. But Ross also defended President Donald Trump’s statements that the U.S. would withdraw from the agreement if Canada and Mexico don’t engage to his liking. “Really, that’s the right thing,” Ross said. “We need fixes to this deal. It has not worked the way that it was intended to.”
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NAFTA talks are happening at a “record-breaking pace,” with two-week breaks between five-day discussions, Ross said. “Relative to the way things have been done before, it is extremely rapid,” he said. The parties are shooting to finish talks “more or less” by the end of the year, and they “can’t drag on” too long, as political elections in all three countries in 2018 could muddy the path forward, Ross said. Mid-2018 Mexican presidential election and Canadian provincial elections, as well as the July 2018 expiration of U.S. Trade Promotion Authority and November 2018 U.S. midterm elections could complicate talks if they last that long, he said.
Ross also called for an improvement in Mexican labor policies, which he mentioned have not translated to a rise in the country’s low minimum wage in several years. While NAFTA was “supposed to raise the standard of living,” the prosperity hasn’t been well-distributed south of the border in actuality, Ross said. The Trump administration has said it hopes to bring labor provisions into the main text of NAFTA (see 1707180022).
The Commerce leader also took shots at trading partners with which the U.S. runs a deficit. “We’re absorbing an awful lot of cumulative problems from elsewhere,” Ross said. “That seems a bit of a heavy burden. And we’re working very hard to try to fix that.” Although South Korea is an important ally in countering the national security threat posed by North Korea, it’s not “inherent in having someone as an important national defense partner, that you also have to run a trade deficit with them,” he added. South Korean automobile imports are the principal contributor to the U.S.’s trade deficit with that nation, Ross said. “That’s why the trade deficit has gotten so big there,” he said. “So it’s very much bundled into one segment.”