NAFTA ministers to meet in washington on wednesday - Politico


  • The three trade ministers from the United States, Canada and Mexico are set to meet in Washington.
  • Mexican officials are increasingly concerned that US Democrats and labor leaders are pushing for changes that would be a threat.

An article in POLITICO is doing the rounds whereby it states that 'the three trade ministers from the United States, Canada and Mexico are set to meet in Washington on Wednesday to discuss the deal to replace NAFTA, seven people familiar with the plans told POLITICO."

The meeting involving U.S. Trade Representative Robert Lighthizer, Deputy Canadian Prime Minister Chrystia Freeland and Mexican Undersecretary for North America Jesús Seade comes as the Trump administration is nearing a compromise with House Democrats to make changes to the USMCA.

Key notes from the article

  • Lighthizer has been negotiating with a group of nine House Democrats to address four main concerns involving the pact’s labor, environmental, enforcement and drug pricing provisions.
  • Any changes to the text would have to be approved by Canada and Mexico before the Trump administration can finalize the agreement and send it to Congress for a vote. Canada is expected to accept changes to the text without issue.
  • It’s not clear whether Mexico will accept new provisions that target how the nation enforces the agreement, particularly when it comes to labor standards. Some Mexican officials are increasingly concerned that Democrats and labor leaders are pushing for changes that would be a threat to the country’s sovereignty.
  • They also worry that any demands that go too far would force Mexico to reject a compromise between Democrats and Lighthizer, further holding up ratification of the pact.
  • Mexico has insisted that it won't support any provision that would allow the U.S. to send inspectors inside its borders to look into facilities. Seade told Inside U.S. Trade last week that a process that would allow for Mexican goods to be blocked at the border is “just absurd.”

FX implications

The CAD, yen, MXN and USD are the main currencies to watch with respect to trade headlines associated to USMCA. The yen picks up a safe-haven bid on uncertainties while the others are directly affected by positive or negative updates associated with the nation's involved and trade between them.

 

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