NAFTA talks make ‘some progress’ but huge differences remain

US, Canada reach deal on revamped NAFTA

Negotiators from the United States, Canada and Mexico are making progress on modernizing their trade agreement. Very. Slowly.

Round 6 of NAFTA talks concluded Monday in Montreal. All three sides agree on some issues, such as digital trade or telecommunications, which weren’t in the original agreement that became law in 1994.

But on the divisive issues, including auto manufacturing, there is no sign of compromise.

“This round was a step forward, but we are progressing very slowly,” U.S. Trade Representative Robert Lighthizer said at a press conference in Montreal. It was the first round of talks in two months after negotiations hit a standstill last fall.

Lighthizer on Monday lambasted Canada’s top counter-proposal regarding auto manufacturing in North America.

Currently, about 62 percent of car parts in a vehicle sold in North America must come from the region. The goal is to maintain some car production — and jobs — in North America.

The Trump administration proposed raising that threshold to 85 percent from 62 percent. Of the parts sourced from within North America, half would have to come from the United States, according to the U.S. proposal. The U.S.-specific rule appears to be the biggest deal breaker for Canada and Mexico.

America’s top trade official had no interest in Canada’s proposal on these so-called rules of origin for auto manufacturing. The details of the counter offer were not immediately available.

“We find that the automobile rule of origin idea that was presented, when analyzed, may actually lead to less regional content than we have now — fewer jobs,” Lightizer said, standing next to Canadian Foreign Minister Chrystia Freeland. “This is the opposite of what we’re trying to do.”

Cautious optimism surrounded the talks.

“We still have substantial challenges to overcome, yet the progress we made so far puts us on the right track,” Mexican Economy Secretary Ildefonso Guajardo, who helped negotiate the original agreement in the early 1990s, said Monday.

Freeland, the top Canadian official, said she hopes for trade pact that’s a “win, win, win” for all three countries and that she was pleased with progress made. But she called the U.S. proposals “unprecedented.”

Officials said they finished a new chapter of NAFTA on corruption laws. The next round will be in February in Mexico City, though exact dates were not immediately clear.