Trump’s tariff threats are actually improving NAFTA negotiations

All smiles.
All smiles.
Image: Reuters/Edgard Garrido
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Donald Trump threw a dynamite stick into the renegotiation of the North American Free Trade Agreement last week, by calling for import tariffs on steel and aluminum. He continued the attack on Monday by suggesting that the only way Canada and Mexico—the US’s NAFTA partners and two of its biggest suppliers of steel—could avoid the tariffs was by ceding to his other trade demands.

But just a few hours later, representatives of the three countries appeared unfazed by Trump’s tirade as they closed the latest round of negotiations to remake the 24-year-old trade agreement. Mexico’s economics secretary Ildefonso Guajardo completely ignored the tariff threats, not even uttering the words “steel” or “aluminum.”

Canadian foreign affairs minister Chrystia Freeland repeated last week’s comment that tariffs would be “absolutely unacceptable.” But at another point, she shot US trade representative Robert Lighthizer a smile, saying, “We’re getting to know each other quite well and I think we’re becoming friends.”

Even Lighthizer, who usually strikes a belligerent tone during NAFTA negotiation statements, was at his most civil. “As president Trump has said, we hope for a successful completion of these talks and we would prefer a three-way, tripartite agreement,” he said.

Wait? Is that the same president Trump that lashed out against both Canada and Mexico today?


It’s unclear why NAFTA’s top negotiators opted for chumminess in response to Trump’s sulky tweets. Are the three really becoming friends, as Freeland suggested? Or were they trying to downplay the damage inflicted by the Trump tariff bomb?

Reports over the weekend suggested the tariff negotiations hijacked the latest NAFTA meetings, which were held in Mexico City. Efforts to renegotiate the deal, which started last August, have already dragged longer than planned. All three members agree that NAFTA has to be updated to include areas such as digital trade and energy that weren’t on the table when the original deal was struck. But Canada and Mexico want to expand trade, not restrict it as the US has proposed.

On Monday, representatives from the three countries chose to highlight the progress achieved so far. They said they settled on new language on three topics in addition to another three sections that had been hammered out during previous six months. That’s a 100% increase in a single round, pointed out Guajardo. He said the three negotiators believe “that an adequate landing strip exists to achieve an agreement that we can keep with great advantages to our three countries.”

Lighthizer was less optimistic. Time is running out and much remains to be done, he said. But he refrained from the kind of confrontational comments he’s made in the past alleging NAFTA’s failures and unfairness.

After delivering their statements, the three representatives hugged and flashed big smiles for the cameras. There was only one moment that seemed to betray the tense state of affairs, particularly between the US and Canada. When asked to pose for the shot by reporters, Freeland switched places with Guajardo to avoid being next to Lighthizer.