Doubts about NAFTA talks grow

Arlington, Va. — Negotiations to remake the North American Free Trade Agreement resumed Wednesday amid increasing concerns of a breakdown, with President Donald Trump continuing to threaten to withdraw from the pact and the administration planning to push several contentious proposals across the table over the next few days.

Concerns were apparent as Canadian Prime Minister Justin Trudeau met with Trump in Washington while trade negotiators from the U.S., Canada and Mexico gathered here on the other side of the Potomac River. As Trump talked about the possibility of not reaching an agreement on NAFTA — saying he could see the U.S. and Canada doing a bilateral deal to replace the pact — Trudeau maintained a straight face.

Asked whether he would be ready to sign a deal only with the U.S., Trudeau answered in French: “We’re negotiating at the moment.”

In three earlier rounds of NAFTA talks, negotiators found common ground on customs and trade facilitation, e-commerce rules and other less-controversial matters that would update the 23-year-old agreement.

But with a goal of wrapping up negotiations by the end of the year, U.S. officials are now expected to get to the crux of the talks with proposals that they see as central to advancing Trump’s “America first” agenda, even though some of those ideas are fiercely opposed by not only Mexico and Canada, but also by U.S. business interests.

One proposal would allow NAFTA to expire after five years unless all three countries agree to renew it, according to people who have been briefed by U.S. trade officials.

The so-called sunset provision is ostensibly aimed at giving the administration a way out, or at least greater leverage, should there be little or no improvement in the U.S. trade deficit with Mexico or Canada — something that Trump has persistently regarded as the measuring stick of whether trade agreements are working, despite widespread criticism from economists who say such thinking is flawed.

Critics of a sunset clause include the U.S. Chamber of Commerce, whose leader, Thomas Donohue, described it as one of “several poison pill proposals … that could doom the entire deal.”

“We all know that certainty and stability are crucial to successful trade relationships — and necessary to foster a pro-investment environment that drives economic growth and job creation,” Donohue said in a particularly forceful speech Tuesday in Mexico City.