Peña Nieto appeared to be sending a signal to the Canadians during the conference call with Trump, Anstett said, by constantly referring to “NAFTA” even as Trump tried to rename the deal.
In saying he was scrapping NAFTA, Trump “completely ad-libbed,” believes Jorge Guajardo, a former Mexican ambassador to China who advises companies on Latin America and China issues from Washington. Mexican officials on the Oval Office phone call with Trump “were not on board with this,” he said, and were caught by surprise.
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An earlier sticking point in renegotiating NAFTA was the US’s insistence that 50% of the content of cars sold in the US be made in the US, Anstett said. The USTR statement issued today says instead that “40-45 percent of auto content be made by workers earning at least $16 per hour.”
Mexico’s hourly average factory wage are less than $3 per hour, while Canada’s are around C$25 (US$ 19.28) so that shift is likely to restrict Mexican imports to the US, not Canada’s.
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One of the biggest sticking points between the US and Canada in earlier negotiations was the Trump administration’s insistence that any agreement end after five years, and be negotiated all over again. Canadian officials balked, because it would make it harder for companies to plan their investments in factories and other facilities.
The new agreement would Mexico would last for 16 years, a senior administration official told reporters after the press conference, but be up for review in six years, with an eye to another 16-year term.