Mexico Draws the Line at Renegotiating NAFTA

Mexico Draws the Line at Renegotiating NAFTA
BY BRIDGET JOHNSON
NOVEMBER 10, 2016

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Secretary of State John Kerry hangs out with Canadian Foreign Minister Stéphane Dion and Mexican Foreign Minister Claudia Ruiz Massieu at LeCiel Restaurant in Québec City, Québec, on Jan. 29, 2016, during a break in the North American Ministerial meeting. (State Department photo)

Mexico's foreign minister said her country is open to efforts that would "modernize" the North American Free Trade Agreement, but that Mexico City would "not renegotiate" the trade deal that was prominent in Donald Trump's campaign pitch.

Claudia Ruiz Massieu told CNN International on Wednesday that "the Mexico-U.S. relationship does not begin, nor does it end with this election."

"It is a mature long-standing relationship based on common interest, common values and a shared vision of the future. The election is over and we're very much looking forward to starting a new chapter with the new administration," she said.

When Trump was still running for the nomination earlier this year, Ruiz Massieu called his policies and rhetoric “ignorant and racist." Of his border wall proposal, she said, “It is impossible to think of a 2,000-mile border being walled off and trade between our two countries stopped. It is impractical, inefficient, wrong and, frankly, it is not an intelligent thing to do.”

Pressed on the border wall this week, she replied, "We fully intend to stay and start working with a transition team to talk about our vision of our bilateral relationship and our vision of North American region."

"We are very much committed to the North American vision, to NAFTA, as the treaty, as an agreement that has yielded great results for all free countries. Commerce and trade have increased over 300 percent, intraregionally. And we have not only traded more between each other, but we have started to produce things together. So we know that today, 22 years after NAFTA was signed and came into effect, there is an opportunity to modernize it so that it's more beneficial for the three countries involved. And we are willing to talk about with the new government and with Canada as well, but we remain committed to NAFTA, to the North American vision and to free trade as a means to creating prosperity, jobs and opportunities for our people."

Ruiz Massieu stressed the Mexican government's belief that "migration is the source of prosperity and growth in our region."

"We have seen a reverse on the migration trends from Mexico to the United States. In the past five years, we've seen more Mexicans returning to Mexico than Mexicans are going to the United States. So we have a negative migration today with the United States," she said. "However, we do have a large community of Mexican people living in the United States. 12 million Mexicans born in Mexico reside in the United States and they contribute daily with their work and their creativity to the United States' growth and prosperity."

"We want to assure that they can become more integrated and have more opportunities. But we are close to our community, close at this time. We have been closer these past months and we keep our community informed with regards to their rights and the prospects of a future... we will work closely with the next government to make sure that their rights are protected and that fruit of their work is also protected."

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Thu Nov 10, 2016 | 4:50pm EST

Mexico ready to discuss NAFTA with Trump, eyes non-U.S. TPP
http://s3.reutersmedia.net/resources...=LYNXMPECA91CP Mexico's Economy Minister Ildefonso Guajardo speaks during a news conference at the National Palace in Mexico City, Mexico, June 24, 2016. REUTERS/Henry Romero

By Dave Graham and Adriana Barrera | MEXICO CITY
Mexico is willing to discuss the North American Free Trade Agreement (NAFTA) with U.S. President-elect Donald Trump but may seek to circumvent the United States on a broader trans-Pacific deal if necessary, a top official said on Thursday.

Economy Minister Ildefonso Guajardo said Mexico aims to persuade Trump how beneficial NAFTA, which took effect in 1994 between the United States, Mexico and Canada, had been for North America, despite the American's criticism of the deal.

"We're ready to talk so we can explain the strategic importance of NAFTA for the region. Here we're not talking about ... renegotiating it, we're simply talking about dialogue," Guajardo said in a telephone interview.

"Today the world is not competing by country, it's competing by region," the minister said, echoing comments by Trump himself during a late August visit to Mexico City when he spoke of the need to keep "manufacturing wealth" in North America.

No date has yet been set for talks, but Guajardo said he expected the two sides to find one soon. President Enrique Pena Nieto said he and Trump have agreed to meet, possibly during the transition period before his inauguration on Jan. 20.

Mindful of the fact that Mexico sends four-fifths of its exports to the United States, Pena Nieto's government has been deeply concerned by the protectionist rhetoric that emanated from the U.S. presidential campaign.

Trump relentlessly attacked NAFTA and condemned the Trans-Pacific Partnership (TPP), a broader deal signed this year between 12 nations on the Pacific Rim that Mexico hoped it could use as a vehicle to update NAFTA and assuage U.S. critics.

The president-elect also angered Mexico by pledging to build a huge border wall to keep out illegal migrants - and make the Mexicans pay for it. He threatened to enforce that plan by taxing remittances sent home by Mexicans in the United States.

If TPP is not the means to modernize NAFTA, Mexico would have to look for other pathways, though any talks on the tri-partite accord would have to include Canada, Guajardo said.

Business leaders south of the border say the U.S. presidential campaign has underlined Mexico's need to reduce its dependence on the United States and the Mexican government sees TPP as a crucial part of efforts to trade more with Asia.

Guajardo said he expected as many as seven signatories to have ratified TPP by the end of 2016, mentioning Japan, Mexico, New Zealand, Australia, Singapore, Vietnam and Malaysia.

Japan's lower house approved the deal on Thursday.
If the U.S. Congress does not ratify the deal, Guajardo said consideration should be given to whether the remainder could put into effect without the world's biggest economy.
"We'll need to talk with the others to change the limiting clause that meant us having to wait until the United States had completed the approval process," Guajardo said.

Trump also rattled Pena Nieto's government with verbal attacks on U.S. companies with factories in Mexico. So far Trump's campaign has not led to any freeze in investment, Guajardo said.

"There haven't been any effects so far because I think the economic players are waiting to see how campaign rhetoric translates into public policy," he said.

Proponents of NAFTA have also criticized business lobbies north and south of the border for failing to mount a strong enough defense of the agreement, and Guajardo said he expected pro-trade voices to gain in strength in coming months.

Mexico and the United States do about half a trillion dollars in trade every year, with the balance of commerce favoring the smaller country by tens of billions of dollars.

Still, Mexico is the United States' second-biggest foreign goods market after Canada. So far this year, 16 percent of total U.S. goods exports have gone to Mexico, U.S. data show.

In spite of the charged campaign rhetoric, Guajardo said he believed NAFTA could be maintained, and he declined to speculate on whether threats by Trump to levy punitive tariffs of up to 35 percent on Mexican goods would ever become actual policy.

"We can't anticipate anything because we'd be anticipating something that wouldn't suit anybody, which is a trade war," he said.

(Editing by Frank Jack Daniel)
http://www.reuters.com/article/us-us...KBN1352N0?il=0