Though the negotiations are back in in US’s hands to make
the next move, with the way the last round of talks went, Canada has been
looking to deepen trade agreements with the Pacific Alliance members. When
President Trump threatened to leave NAFTA after the offered negotiations were
rejected, Canada began discussing with officials in Peru and Chile. Canada
already has free trade deals with these countries, but since the US is Canada’s
top trading partner, losing NAFTA would force Canada to find stronger and more
reliable trade, or suffer the consequences. With the looming threat of NAFTA’s
possible dissolution, Mexico has also began looking at other trade options. One
option currently being explored lies in the EU. To read the full article read
HERE
Source:
Patrick Gillespie.
(2017). Canada and Mexico prepare for life without NAFTA - Oct. 24, 2017.
Retrieved October 24, 2017, from
http://money.cnn.com/2017/10/24/news/economy/canada-nafta/index.html
I am definitely confused by the US's stance on this. It looks like both Mexico and Canada are looking to different countries to either strengthen their trade bonds or start new partnerships. These countries are two of our largest trading partners AND they have a huge stance in the global economy. I don't have a problem with the negotiating, I have a problem with what the US is trying to pass. For example, the Sunset clause. This clause would set a time frame of 5 years, where if the countries don't agree to sign on again for another 5 years, it will disband. This makes the whole contract seem very uncertain. The countries are already allowed to withdraw from the deal if they give 6 months notice, so I guess I don't see the point of this clause.
ReplyDeleteBrianna, that is the came what I was thinking. I do not understand Trump's tactic. It does strengthen the US position in the negotiation, starting with an extreme opening position, but it also forces Canada and Mexico to look for alternatives for the "worst case scenario". This makes me worry, that in fact the strategy might weaken the US position if the trading partners find alternatives more attractive, or at least that the alternatives will strengthen their position and make the US depending on their decision.
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