Mexico and Canada insist on NAFTA as a 3-way deal

Canadian and Mexicanofficials insisted on Wednesday that the North American FreeTrade Agreement remain a trilateral pact and reiterated theiropposition to U.S. calls for a so-called "sunset clause" thatcould end the deal after five years.

After a meeting in Mexico City, Canadian Foreign MinisterChrystia Freeland and Mexican Economy Minister IldefonsoGuajardo said they remained optimistic about negotiations torevamp the 24-year-old trade pact.

Talks began last August but stalled in the run-up to theMexican presidential election. That was due, at least in part,to U.S. demands for sweeping changes in the auto sector and fora sunset clause, which would put the deal forming one of theworld's largest trading blocs up for renewal every five years.

U.S. President Donald Trump has repeatedly threatened towithdraw from the pact if he cannot renegotiate it to betterserve his country's interests.

Freeland and Guajardo struck an upbeat tone, with Guajardosaying about two-thirds of the agreement has been ironed out.

In Washington on Wednesday, U.S. Agriculture Secretary SonnyPerdue raised the prospect that NAFTA could be negotiatedseparately with Canada and Mexico, in order to reach anagreement first with Mexico by September.

Although Mexican officials are heading to Washington this week to meet with their U.S. counterparts, Guajardo stressed that a deal between all three countries remained the goal.

"The fact that we are going to Washington to participate inbilateral talks is to reinforce the concept of the trilateralism
of this agreement," he said. "The essence of this agreement istrilateral, and it will continue being trilateral."

Back into high gear

Freeland also expressed support for a three-way deal, as didMexico's incoming foreign minister, Marcelo Ebrard.

"It should and can be modernized but we're not thinkingabout it having a different nature to that of today," Ebrardsaid, speaking after a meeting between Freeland andPresident-elect Andres Manuel Lopez Obrador.

Freeland said the sunset clause could harm the autoindustry, adding that Ottawa opposed a U.S. investigation ofauto imports.

Lopez Obrador, who won the nation's July 1 election, hassaid he wants to accelerate the negotiations. His lead NAFTAnegotiator, Jesus Seade, will join the Mexican delegation inWashington this week.

Freeland, who held what she described as a good meeting withthe president-elect, said she came away with a clearunderstanding of where he stood on NAFTA but declined to givedetails.

"Canada's very clear desire is to move the NAFTAnegotiations back into higher gear now that we are past theMexican election," she told reporters.