U.S. Trade Representative Releases NAFTA Negotiating Objectives07/24/2017
This week the Administration released the negotiating objectives for the North American Free Trade Agreement (NAFTA). The objectives are comprehensive and cover most sectors and subjects that have been a part of previous trade agreements.
The first goal listed under Trade in Goods is to reduce the U.S. trade deficit with NAFTA countries. This could be problematic depending on how they seek to achieve this outcome. That said, the Administration does not propose withdrawing tariff concessions. In fact, they propose reducing or eliminating remaining duties in the ag sector. They even propose providing reasonable adjustment periods for U.S. imports of sensitive agricultural products, which implies a willingness to put U.S. tariffs for dairy and sugar-containing products on the table. They also propose World Trade Organization (WTO)-plus Sanitary and Phytosanitary (SPS) disciplines which track with the recommendations the American Soybean Association (ASA) proposed in its NAFTA recommendations.
Regarding regulatory policy, the Administration proposes promoting regulatory compatibility, transparency and information-sharing, and developing a mechanism for improved dialogue and cooperation. However, the trade remedies objectives are quite protectionist. They propose a number of changes that could make it easier to impose duties and safeguard measure on NAFTA parties. While this may benefit the U.S. in some areas, it will also open the U.S. up to duties imposed by Canada and Mexico. NAFTA negotiations will likely begin in mid-August per Trade Promotion Authority (TPA) rules.
Source: American Soybean Association