NAFTA demise would not be devastating, Mexico says

MEXICO CITY, (Reuters) - Mexico’s economy minister said yesterday he did not agree with statements made by U.S. Commerce Secretary Wilbur Ross that it would be devastating for Mexico if the United States pulls out of the North American Free Trade Agreement (NAFTA).

“No, I don’t think so,” Ildefonso Guajardo said in a television interview when asked if he agreed with Ross.

“Without a doubt, Mexico could face a short-term impact because the market is very sensitive to marketing, branding ... Our ability to adjust, and the manner in which we do it, is what will allow us to resist any potential change.”

In an interview with The Wall Street Journal CEO Council on Tuesday, Ross said that it “would be devastating to the Mexican economy” if the United States were to pull out of NAFTA.

Mexico is preparing a package of macroeconomic measures to help withstand a short-term shock if the United States pulls out of the pact, Foreign Minister Luis Videgaray said earlier in the week.

Guajardo said that if NAFTA talks, which are currently in their fifth round in Mexico City, do end up stretching into March, the United States must ask itself if it wants the trade talks to influence Mexico’s July 2018 election.

The fifth round of NAFTA talks entered their second day on Thursday, proceeding under the shadow of tough U.S. demands and without the presence of trade ministers who agreed to sit out the discussions.

A schedule seen by Reuters showed that negotiators will discuss one of the most contentious issues over the four final days, beginning Saturday.