80% chance of NAFTA deal within month, says Mexico

WASHINGTON — There’s an 80 per cent chance of a new NAFTA agreement in principle within a month, the Mexican minister leading the file said Monday.

Secretary of Economy Ildefonso Guajardo told the Mexican network Televisa that he believes a deal is probable soon.

“I would tell you there is a high probability of 80 per cent,” he said. “It will depend a lot on flexibility.”

He said it won’t happen within days, nor — as some had hoped — by the end of this week in time for Donald Trump, Justin Trudeau, and Enrique Pena Nieto to make the announcement at the Summit of the Americas in Peru.

But Guajardo said negotiators from all three countries are now speaking constantly. He said officials are still negotiating technical details in Washington, after their political bosses, Chrystia Freeland, Guajardo, and Robert Lighthizer held talks last week.

“It’s a permanent round,” Guajardo said, describing the non-stop negotiations.

He said it will become clear by the first week of May whether an agreement in principle is possible this spring, after which point the talks could languish until 2019, while Mexico elects a new president and the U.S. elects a new Congress.

Guajardo warned nothing is guaranteed in this political environment. In an oblique reference to Trump and his social-media habits, Guajardo said policymakers sometimes find themselves scrambling to respond to the thoughts of a superior shared publicly at 6 a.m.

He said the U.S. had already shown some flexibility on the issue that is the focus of current negotiations: autos. He confirmed that the U.S. had been willing to drop its demand that 50 per cent of every car consist of American parts, in exchange for a new system that credits parts-makers when they pay more than $15 an hour.

The policy could punish Mexico. As Guajardo noted, that $15 figure is several times the current wage of workers there: “In Mexico — we clearly don’t have that.”