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NAFTA Negotiations Have Yet To Produce A New Agreement


Time is running out for trade negotiators if they hope to get a vote in Congress this year on a new North American Free Trade Agreement, or NAFTA. House Speaker Paul Ryan had set a deadline for today. Ryan concedes there may be some wiggle room but not much. President Trump has been pushing for big changes in the trade deal which took effect almost a quarter century ago. So far, U.S. negotiators have not been able to come to terms with their counterparts from Mexico and Canada. NPR's Scott Horsley is here now to bring us up to speed on the latest. Hi, Scott.


SHAPIRO: These talks have been going on since last August, so what's so special about this week? Why the deadline?

HORSLEY: It's all about the congressional calendar, Ari. If the White House succeeds in reaching a new NAFTA agreement, it hopes to get it through Congress using a process known as fast track authority or trade promotion authority sometimes abbreviated as TPA. And fast track here is kind of a misnomer because it's not all that fast. Lawmakers and others have to have a certain amount of time to review the agreement. And House Speaker Paul Ryan's been looking at the calendar, counting the days. He says if you want to vote by year's end, you need a deal soon - maybe not today but pretty soon.


PAUL RYAN: Point is, we can't work a bill unless we have an agreement that's in writing that we can work, and that hasn't occurred yet. This isn't my arbitrary deadline. That's just the way the TPA law works.

HORSLEY: Otherwise, the vote could slip to next year. And depending on what happens in the midterms, you could be looking at a very different Congress.

SHAPIRO: Canada's prime minister said he feels good about the chances of reaching a deal, so what are the big sticking points?

HORSLEY: Well, the way it works right now under the current NAFTA - for example, automakers are allowed to assemble cars with parts made anywhere in North America. And those can go back and forth across the borders duty-free. The Trump administration wants to rein that in. So cars would only qualify for duty-free status if a certain percentage of their components came from what they call high-wage countries in North America. That is the U.S. and Canada, not, for now at least, Mexico.

The administration also wants to limit the ability of multinational companies to sidestep local laws and regulations. And it wants a chance to renegotiate NAFTA every five years. Now, some of these demands are actually more popular with Democrats in Congress than they are with Republicans. And Democratic Congresswoman Rosa DeLauro suggests Paul Ryan is actually trying to sabotage these negotiations by imposing that hurry-up deadline.

ROSA DELAURO: Before he retires, Speaker Ryan has attempted to create this false sense of urgency in order to derail the negotiations. From my point of view, it's his final parting shot at working families.

SHAPIRO: So that's the NAFTA talks. Separately, the administration has also engaged in trade talks with China this week. What's the goal there?

HORSLEY: The administration wants to bring down its big trade deficit with China and also improve the way that country treats American businesses' technological know-how. And this has been a kind of a tense faceoff between the U.S. and China. The U.S. has slapped tariffs on Chinese steel and aluminum. China's retaliated with tariffs on U.S. pork and other farm products. China has also basically stopped buying soybeans from the U.S. Last year, they bought nearly $14 billion worth. Now they're buying those from Russia and Brazil instead.

The White House is hoping to work out some kind of negotiated settlement to head off a broader trade war. And at the same time, President Trump needs China's help in dealing with North Korea. By the way, Trump is still looking ahead to a summit meeting with North Korean leader Kim Jong Un next month although the North Koreans have made noise about pulling out of that.


HORSLEY: The White House says they're proceeding as if those talks are going to happen.

SHAPIRO: NPR's Scott Horsley, thanks as always.

HORSLEY: You're welcome. Transcript provided by NPR, Copyright NPR.

Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.
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