But reaching an accord looks increasingly difficult as the administration continues to push for ambitious changes that rankle Mexican and Canadian counterparts. Those include setting new requirements for the use of American-made goods and lowering barriers to exporting American agricultural products.
The White House is particularly eager to show progress on the trade agenda — one of President Trump’s signature campaign issues — given the failure of Congress to repeal and replace the Affordable Care Act and the uncertainty about tax reform.
For a new Nafta pact to be approved by lawmakers in the three countries, negotiators say it needs to be largely concluded by the end of the year. They fear approval could be complicated by a series of events, including Mexico’s presidential election on July 1, 2018, midterm elections in the United States and provincial elections in Canada.
Legislation authorizing Congress to pass a trade deal with a simple up-or-down vote is also scheduled to expire in July.
“The political calendar is such that if we don’t get a deal more or less by the end of the year… it will get harder and harder,” Commerce Secretary Wilbur Ross, who helps lead the trade agenda, said last week.
New proposals by the Trump administration are adding pressure to the already complex negotiations.
Last week, Mr. Ross told an audience that the administration was considering adding a “sunset clause” to the North American pact. Under such a measure, the agreement would terminate after five years unless all three countries voted to continue it.
Canadian officials and business community representatives have expressed concern about a temporary pact.
David MacNaughton, Canada’s ambassador to the United States, criticized the provision. “If every marriage had a five-year sunset clause, I think our divorce rate would be a heck of a lot higher than it is right now,” he said.
Chad Bown, a trade analyst at the Peterson Institute for International Economics, said a sunset provision would create so much uncertainty that businesses might end up ignoring Nafta altogether in their planning. It can take years for businesses to recoup the returns from investments, by which time Nafta might no longer exist.
A Canadian government official briefed on the negotiations, speaking on condition of anonymity, said that Canadians were surprised by the proposal. Mexican officials could not immediately be reached for…