After months of heated rhetoric and diplomatic groundwork, talks to overhaul the North American Free Trade Agreement will formally begin this week with Canada pushing for more stringent labour and environmental standards in the deal.
Canada’s top diplomat, Foreign Affairs Minister Chrystia Freeland, will travel to Washington Tuesday where the first round of formal negotiations is set to take place.
Freeland will sit down to break bread with her U.S. and Mexican counterparts before officials get down to brass tacks in a bid to modernize the 25-year-old trade pact Wednesday.
Each side will begin to set out what it wants to see in the rewrite; in Canada’s case that will include stronger environmental and labour provisions and a formal mechanism to settle thorny trade disputes.
Some interest groups are hoping for a speedy process to keep investors calm, but some international trade experts warn that business should brace for a drawn-out series of discussions.
Jeffrey Schott, a trade policy analyst and senior fellow at the Washington-based Peterson Institute for International Economics, said while the goal is for expeditious rounds, the administration of U.S. President Donald Trump has laid out objectives that could lead to an impasse.
Those include proposed changes to government procurement, rules of origin and a goal of eliminating the U.S. trade deficit.
Resistance to U.S. ‘overtures’
“Those are areas where they will undercut the competitiveness of North America producers and workers and there will be resistance from Canada and Mexico to the U.S. overtures,” he said.
Schott expects talks will spill over to next year, and will then be constrained by next year’s Mexican presidential election, followed by U.S. mid-term congressional elections. He predicted talks will continue on into 2019, when there will be other elections, including a federal election in Canada.
“I see a low probability of an agreement on a modernized NAFTA in the near term,” he told CBC News in an interview. “I think negotiators will go through what can be done that is helpful and reject efforts to try and make revisions that are counterproductive. But finding the discreet window when the political stars align in all three countries is going to be difficult, and is unlikely to…