Monday, March 5, 2018

Divide and conquer NAFTA tactic

“Our time is running very short,” said Robert Lighthizer, chief U.S. negotiator, after the latest round of North American Free Trade negotiations ended Monday in Mexico City.

And he said that while he prefers a three-country deal, the U.S. might try to strike separate deals with Mexico and Canada.

He also used Trump’s surprise announcement of a 25 per cent tariff on steel and 10 per cent on aluminum to put pressure on Canada because he said if a deal is struck, the tariffs would not apply.

Trump clearly surprised his team with his tariff announcement because the Secretary of State, the Secretary of the Treasury and Lighthizer didn’t know it was coming before Trump sprung it last week, triggering incensed responses from around the world.

There are also indications that Lighthizer has trouble responding to Canadian and Mexican proposals to deal with two of the most contentious demands Trump has made in the NAFTA negotiations – an end to disputes-settling panels and a review of the trade agreement every five years.

He apparently doesn’t know what Trump will do if he makes even minor concessions on those issues, some observers have said.