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International Finance
Economy

Mexico ready to discuss NAFTA rules

Will try to avoid a disruptive fight with the United States over commerce

January 26, 2017: Mexico is preparing to discuss changes to trade rules about a product’s country of origin to try to avoid a disruptive fight with the United States over commerce.

Mexico sees possible common ground with US President Donald Trump on the “rules of origin” of the North American Free Trade Agreement (NAFTA) that binds the two countries and Canada, several sources said.

Rules of origin are regulations setting out where trade products are sourced from. Although formal negotiations about NAFTA have not begun, the rules could eventually be altered to favour US industry over competitors from outside North America, particularly in Asia.

On January 20, Donald Trump took office as the forty-fifth President of the US. He vowed to make ‘America first’ again.  Fulfilling his campaign promise, he has already withdrawn the US as a signatory from the Trans-Pacific Partnership trade deal, as he credited international trade deals for loss of jobs in the US. Trump also intends to boost manufacturing in America.

During his electoral campaign, Trump expressed his strong desire to scrap NAFTA as he felt that the agreement was much more beneficial to other parties and not the US.

President Donald Trump formally withdrew the United States from the TPP trade deal on January 22.

“We’re going to stop the ridiculous trade deals that have taken everybody out of our country and taken companies out of our country,” the President said as he met union leaders in the White House’s Roosevelt Room.

Mexican Foreign Minister Luis Videgaray and Economy Minister Ildefonso Guajardo will hold talks with top Trump officials in Washington on January 25 and 26 where security, migration and trade will be discussed.

“What we want is to maintain free access for Mexican products, without restrictions, without tariffs and quotas,” Videgaray, the spearhead of the government’s outreach to Trump, said on January 23.

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