U.S. be­gins lob­bing NaFta bomb­shells

North Bay Nugget - - OPINION - AlexAn­der PAnettA

PeN­tagON, united States — the NaFta ne­go­ti­a­tions have now en­tered their most dif­fi­cult phase with the united States be­gin­ning to drop its bomb­shell pro­pos­als on the ne­go­ti­at­ing ta­ble at a just-be­gun round out­side Wash­ing­ton.

u.S. of­fi­cials had fore­shad­owed that this week-long round would be where the most con­tentious dis­cus­sions opened and that is com­ing to fruition, with the amer­i­can side lev­el­ling one de­mand deemed a non-starter — and pre­par­ing to de­liver an­other one.

the just-de­liv­ered de­mand would cre­ate a so-called ter­mi­na­tion clause. the clause would end NaFta af­ter five years, if its mem­ber coun­tries fail to ex­plic­itly re­new it. that pro­posal was de­liv­ered late Wed­nes­day night.

that comes af­ter the u.S. pro­posed far stricter buy amer­i­can rules at the last ne­go­ti­at­ing round, and in the leadup to one of the most im­por­tant pro­pos­als of the en­tire ne­go­ti­a­tion: On rules for auto parts, which could come as early as Fri­day.

u.S. com­merce Sec­re­tary Wil­bur ross con­firmed the five-year ter­mi­na­tion idea. he shrugged off the fact that other NaFta coun­tries are ve­he­mently op­posed to it, see­ing it as a desta­bi­liz­ing in­vest­men­tkiller and un­ac­cept­able red line.

“yes, that’s our pro­posal,” ross said dur­ing a panel dis­cus­sion Wed­nes­day at the den­tons law firm. “red lines, blue lines, green lines, pur­ple lines. those are just colours in a rain­bow... it’s a big, com­pli­cated ne­go­ti­a­tion and the key is hav­ing an over­all pack­age that works (at the end).”

the next big drop could oc­cur Fri­day.

that’s when the group han­dling rules for auto parts meets for the first time in this round, and it’s ex­pected the u.S. is pre­par­ing to level de­mands viewed as non­starters by canada, Mex­ico, and the auto in­dus­try.

One re­port said the planned de­mand would re­quire 85 per cent of a car’s parts to come from North amer­ica, and half of them to come from the u.S. that in­dus­try says many of th­ese com­po­nents sim­ply aren’t made on the con­ti­nent, and warn that if the rules get too oner­ous they might just stop work­ing within NaFta and start pay­ing tar­iffs.

again, ross con­firmed that u.S. pol­icy is headed in that di­rec­tion, and shrugged off the con­cerns: “i think you’ll find the car com­pa­nies will adapt them­selves to it,” he said.

the main thing other coun­tries are try­ing to fig­ure out about this hard­line ap­proach from the u.S. is what it sig­nals: Flex­i­ble open­ing po­si­tions that will change with time, in­flex­i­ble de­mands, or a de­sire to poi­son the talks and do away with NaFta en­tirely.

Of­fi­cials in canada say they’re le­git­i­mately baf­fled by where the u.S. is headed.

as for Mex­ico, the de­mands be­ing lev­elled cross sev­eral of the six so-called red lines laid out in that coun­try’s Sen­ate, which says it would refuse any deal that in­cludes a ter­mi­na­tion clause, a u.S. auto con­tent re­quire­ment or the end of the chap­ter 19 dis­pute-res­o­lu­tion sys­tem.

an of­fi­cial in one of those two coun­tries says it’s im­por­tant to keep ne­go­ti­at­ing calmly.

“We’re ex­pect­ing some con­tentious pro­pos­als this week,” he said. “hav­ing said that, no one should lose sight of the fact you have three teams of ne­go­tia­tors work­ing to make progress on the deal and they are mak­ing progress.”

U.S. Com­merce Sec­re­tary Wil­bur Ross

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