Generally speaking the corporate media have yet to have an honest outline about the fatal flaw within NAFTA that allows China, ASEAN nations and the EU to exploit previous investments in Canada and Mexico as a back-door to the U.S. market.
In a generalized aspect, the recent visit of top U.S. trade and economic policymakers to China was part of Trump’s exploration into the larger dynamic of bi-lateral trade between the U.S. and China knowing full well the NAFTA flaw remains unaddressed. Without addressing the loop-hole (aka ‘fatal flaw’) any modernized NAFTA deal is moot; and by extension the foundation for any future trade deal between the U.S. and China is too byzantine to manage.
It is in China and the EU’s interests to continue exploiting the NAFTA access. It is in Canada and Mexico’s interests to retain the subsequent investment influx.
It is in multinational corporate and Wall Street interests to continue the scheme. However, it is also entirely against U.S. Main Street interests. Hence, NAFTA loggerheads reigns supreme; and in my opinion, we are soon to see President Trump cut the Gordian knot.
WASHINGTON (Reuters) – Senior Canadian, U.S. and Mexican officials trying to rescue slow-moving talks to update the NAFTA trade pact met on Monday in a new bid to resolve key issues before regional elections complicate the process.
With time fast running out to strike some kind of deal on the North American Free Trade Agreement, the three member nations are still far apart on major points.
Discussions in Washington will center on one particularly contentious area — the U.S. demand for tougher rules of origin governing what percentage of a car needs to be built in the NAFTA region to avoid tariffs.
Other challenges include the future of the pact’s dispute-resolution mechanism and a U.S. proposal for a sunset clause that could automatically kill the deal after five years.
“We will be working all week on this,” Mexican Economy Minister Ildefonso Guajardo told reporters after talks with U.S. Trade Representative Robert Lighthizer.
Asked how long he would be staying in Washington, he replied: “We will be here for as long as necessary”.
Sources close to the talks suggest there is a creeping feeling of pessimism going into the new round of negotiations because of gridlock on critical matters. (read more)