American trade and commerce officials could soon begin work with Canada and Mexico to renegotiate the decades-old North American Free Trade Agreement (NAFTA).
In a joint press conference with Mexico’s economic minister, U.S. Secretary of Commerce Wilbur Ross announced Friday, March 10, that they are in the very early stages of having the talks to change NAFTA.
Ross said he hopes to start the formal process in the coming weeks, according to CNBC.
Although the process may start soon, it likely won’t end as soon. In a March 8 interview with Bloomberg, Ross said there are a myriad of points that will need to be addressed as there were roughly 20 chapters in the first iteration of NAFTA. Several more need to be added and some need to be edited.
“Everybody knows times are different,” Ross said in the Bloomberg interview. “We are going to have new trade relations with people, and they all know they’re going to have to make concessions. The only question is, what’s the magnitude and what’s the form of the concessions?”
One thing Ross would like to address, according to Bloomberg, is the U.S. trade deficit with Mexico.
We regularly have a trade deficit with our southern neighbor, and Ross said he would like to reduce or eliminate it.
Ross said in that interview, they’re in the early stages of the Trade Promotion Authority process, which would allow Congress to consider, without amendment, the trade agreements the administration negotiates.
He estimated then that it would be the latter part of this year before the real negotiations get underway.
NAFTA plays a large role in the Texas economy, according to the American Farm Bureau Federation (AFBF).
From the beginning of implementation to last year, Texas exported $4.4 billion worth of agricultural products to Canada and Mexico. That’s about half of all exports out of Texas.
“NAFTA is huge. More than Canada and Mexico, the other two partners in NAFTA are consistently in the top three in destinations for U.S. products,” Veronica Nigh, AFBF economist, said in an interview with the Texas Farm Bureau (TFB) Radio Network.
Mexican and Canadian authorities have been vocal about their concerns with the renegotiations.
Mexican lawmakers are working to pass legislation that would boycott imports of American corn. Meanwhile, Mexico’s Economy Minister Ildefonso Guajardo Villarreal announced Friday Mexico will be ready by the end of May to start the talks.
Canadian Prime Minister Justin Trudeau has made several trips to the states to discuss NAFTA and their hopes for the renegotiation process.
NAFTA was implemented in 1994. The trade agreement removes barriers to trade between the U.S., Mexico and Canada.
Ross has said although NAFTA is currently a trilateral agreement, renegotiations could lead to two bilateral agreements between the countries as the president prefers bilateral to multi-country agreements.