Mexico concerned with US desire to cut trade deficits

By Nancy Caouette

MEXICO CITY

Economy Minister Ildefonso Guajardo raised concerns Tuesday about U.S. insistence on reducing trade deficits during renegotiations of the North American Free Trade Agreement (NAFTA).

But Guajardo said the priorities for the forthcoming talks presented by the U.S. administration of President Donald Trump in a document Monday contained “no surprises”.

"We took note of all these points. They defined the U.S. vision of the issues they would like to touch on in the renegotiation of NAFTA. But we will see how these points fit with the objectives of Canada and Mexico," Guajardo said during a local television interview.

U.S. desire to reduce trade deficits with Canada and Mexico is a “mercantilist vision of the commercial issue”, he warned.

“I have insisted on the fact that we will gladly review the trade balances, as long as we focus on how to improve them through the expansion of trade, not by reducing it,” he said.

Guajardo said Mexico is preoccupied with the desire of Trump’s government to eliminate Chapter 19 that obliges the parties to submit any anti-dumping and anti-subsidy lawsuits to arbitration panels.

"All this is going to be subject to the three parties agreeing on the process. But in general, there is nothing to be borne out about what the actors have commented on so far,” he said.

Guajardo also emphasized Mexico welcomes the fact that a document presented by U.S. Trade Representative Robert Lighthizer to American lawmakers Monday does not mention the reintroduction of quotas or tariffs on exports to the U.S.

During his election campaign and in the first weeks of taking office, Trump threatened to scrap NAFTA and impose a 35 percent tariff on products such as cars made in Mexico.

But he announced in late April he was willing to renegotiate the 23-year-old treaty with his North-American counterparts.

The tripartite trade talks are due to start Aug. 16.