Now that new U.S. Commerce Secretary Wilbur Ross is beginning to settle down in office, the fog surrounding the future of the North American Free Trade Agreement (NAFTA) begins to clear.
“The first thing on our agenda is NAFTA, because we think it makes sense to solidify your own neighborhood first,” he told NCNBC recently. His statement was a welcome voice to Mexicans who are not just ready but eager to start the renegotiation of many issues.
In fact, new Mexican Foreign Relations undersecretary for North America and former ambassador to the United States Carlos Sada, at a meeting Wednesday with the Foreign Relations Committee at the Mexican Chamber of Deputies, said that negotiations will start “Whenever, because Mexico is not in a hurry and will not force the renegotiation of NAFTA with the United States.”
Sada also told deputies that “Up until now there has been nothing negotiated because this time it will be done on an integral manner. We will not renegotiate NAFTA on one side and immigration and security or water on other sides; negotiations will be a complete package.”
Or as former U.S. President George W. Bush would have put it: “The Whole Enchilada.”
The one issue remaining to solve for the three NAFTA participating governments — Canada, the United States and Mexico — is timing.
Timing will surely represent a problem for Mexico for no other reason than its electoral agenda.
In fact, the Chamber of Deputies has tried to reschedule the upcoming Bilateral Meeting with U.S. Representatives, but it was not possible and it will be held from June 3 through 5 in Mexico City even if there are elections for governor in three Mexican states, including the State of Mexico, located in the metropolitan area.
Secretary Ross still has to present the U.S. Senate with a NAFTA renegotiations agenda and wait approximately for three months for approval of the preliminary meeting. Supposing he presents the agenda at the end of March or after Easter in April, approval should come by July. After the preliminary meeting, real negotiations should begin either at the end of 2017 or the start of 2018.
“Negotiations should take about a year, no more,” Ross told Bloomberg news.
The problem for Mexico will be that 2018 is presidential and congressional elections year. Election-day will be June 6 and the nation will be busier electing a new president than thinking about NAFTA.
The new Congress in Mexico will be sworn in on Sept. 1, and the new president on Dec. 1.
That creates a problem for Mexico, as there is no assurance that the negotiating team headed now by Economy Secretary Ildefonso Guajardo has until Nov. 30, 2018, to deliver a finished product. The problem is what if negotiations are not over? Will the new president confirm Guajardo and actually accept the trade deal as negotiated?
Also, in November, there will be mid-term elections in the United States with 33 Senate seats up for grabs. How will the outcome affect negotiations?
Another question that arises is what role will play the new U.S. Trade Representative Robert Lighthizer will play in the negotiations? Will he be in charge and report to Secretary Ross?
All these questions may have answers but surely even if the time for renegotiation is ripe, the timing may present hurdles to overcome.