NAFTA talks' 4th round to close as disagreements persist

Washington (AFP) –


A fourth round of talks to revamp a landmark North American free trade pact was due to close Tuesday, as delegates reacted to tough bargaining positions from Washington but vowed to continue the negotiations.

With hours remaining in the latest round, the Canadian aircraft manufacturer Bombardier and Europe's Airbus on Monday also announced a partnership to begin US-based production of a passenger jet series at the center of a trade dispute with Washington.

President Donald Trump has persisted in threatening to scrap the 23-year-old North American Free Trade Agreement, even as negotiators claim they have inched towards common ground on issues including telecoms, digital trade and competition policy.

This week's talks were extended by 48 hours to a full week to allow additional bargaining time for delegations from the United States, Mexico and Canada.

All three sides are reportedly considering doing likewise for remaining talks this year -- or even extending them into early 2018, despite looming Mexican elections and the expiry of fast-track authority for US negotiators in the middle of next year.

The talks have proceeded at a brisk pace, with rounds so far scheduled only about two weeks apart to cram in discussions of hot-button issues.

Canadian officials have rejected US calls for greater access to Canada's protected dairy market.

Sources close to the Canadian and Mexican delegations told AFP that while US demands were tough, both countries were committed to continuing with the talks.

"We disagree with some of the proposals presented by the United States but we're not rejecting anything outright and we're still committed to the NAFTA negotiations," a source close to the Canadian delegation said.

- 'Are these positions serious?' -

But analysts say the US bargaining position has a number of elements its partners may find tough to swallow, including rules on access to government procurement and a possible five-year "sunset clause" on the agreement -- which could require the three countries to re-authorize the agreement rather than allow it to exist in perpetuity.

Washington has also called for an end to certain forms of trade dispute arbitration and for US content requirements for auto manufacturing, which the auto industry itself opposes.

Scott Miller, a senior advisor at the Center for Strategic and International Studies, said US officials were advancing some positions -- particular fresh content requirements for auto manufacturing -- that were likely to be non-starters for US industry and lawmakers.

"Why would any administration table provisions that actually subtract from their vote totals?" he asked.

This could suggest Washington does not intend to arrive at a bargain acceptable to Congress anyhow, he added.

"My questions are -- are these positions serious and if so, please name the constituents in American politics who think they're a good idea," he told AFP.

"Or are they simply a way to create a narrative to defend withdrawing from NAFTA?"

"I haven't been able to find as straight answer to that question," said Miller.

Trump was propelled into the White House on a nationalist economic agenda and vowed to upend decades of prevailing trade policy, but stopped short of threats to do away with NAFTA.

But the NAFTA talks have ruffled feathers among market participants and industry players across the North American region, reanimating long-standing criticism from labor and left-wing activists and while unnerving the powerful US Chamber of Commerce.