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The United States has laid down a tough line ahead of talks aimed at what it calls a "modernization" of the North American Free Trade Agreement, demanding major changes to the 23-year-old pact between Mexico, Canada and the U.S.
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Speaking at a press conference before the start of the renegotiations in Washington, D.C., Trump’s top trade advisor Robert Lighthizer said NAFTA had "failed many, many Americans" and that Trump was not interested in "a mere tweaking" of the agreement in order to reduce U.S. trade deficits with Mexico and Canada.
"We feel that NAFTA has fundamentally failed many, many Americans and needs major improvement," Lighthizer said in an opening statement.
Mexican Economy Minister Ildefonso Guajardo said the aim of the talks should not be to tear up NAFTA but to forge a stronger deal.
"The issue is not tearing apart what has worked, but rather, how we make our agreement better," he said. "For a deal to be successful, it has to work for all parties involved. Otherwise, it is not a deal."
Mexican demonstrators, meanwhile, were seen holding signs reading, “The TLC (NAFTA) hurts you, Mexico is better without the TLC,” as they marched towards the Ministry of Foreign Affairs in Mexico City.
Trade union leaders have said they have a right to know the terms and conditions of the NAFTA renegotiations, claiming that they are not properly represented by the Mexican government.
Canada's Foreign Minister and lead NAFTA negotiator Chrystia Freeland voiced a difference with the U.S. position on the need to shrink trade deficit.
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"Canada does not view trade surpluses or deficits as a primary measure of whether a trading relationship works," she said in her opening statement. "Nonetheless, it's worth noting that our trade with the U.S. is balanced and mutually beneficial."
Derek Burney, a former Canadian ambassador to Washington who was involved in the first NAFTA negotiations, said that in the previous NAFTA talks there was a political commitment from all sides to reach a deal, but that is not the case now.
"What will Trump accept as a success in these negotiations?" Burney asked. "To me, that is the biggest wild card of all."
Trump, who made trade a centerpiece of his presidential campaign, has called this free trade agreement between the U.S., Canada and Mexico a jobs "killer" and a "disaster," pledging to repeal it. But in April, he pulled back and agreed to discuss "modernizing" the agreement.
Since NAFTA took effect in 1994, U.S.-Canada-Mexico trade has quadrupled, surpassing US$1 trillion in 2015.
NAFTA renegotiations will be a major test of Trump’s ability to meet his campaign promises to restore U.S. manufacturing jobs and to put “America First.”
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