Tele Sur | 16 August 2017
NAFTA renegotiation talks arrive amid diverging interests, neoliberal goals
As Mexico, Canada and the U.S. head into potentially thorny talks, critics say that banks and multinationals will be first to reap the benefits.
The first round of talks are set to begin for the renegotiation of the 23-year-old North American Free Trade Agreement NAFTA on Wednesday. Many are expecting thorny bargaining to take place between Canada, Mexico, and a newly “economic nationalist” United States imbued with President Trump’s “America First” outlook promising stringent protectionist measures.
Meant to do away with trade barriers and expedite the free circulation of goods and services between the countries, the 1994 pact reconfigured the countries’ economies toward regional integration.
However, in Mexico, agrarian organizations and popular movements have criticized NAFTA for devastating the country’s small producers and hurting Mexico’s overall food sovereignty, turning the country into an exporter of raw materials and an importer of processed products. Meanwhile, industrial jobs in the U.S. were offshored to Canada and low-cost manufacturing hubs in Mexico.
"NAFTA must be renegotiated just to stop its ongoing damage,” said Lori Wallach, the director of Public Citizen’s Global Trade Watch in Washington, D.C. “But depending on how the administration conducts these talks, NAFTA could get worse for working people in all three NAFTA countries.”
The negotiators – U.S. Trade Representative Robert Lighthizer, Canadian Foreign Minister Chrystia Freeland and Mexican Economy Minister Ildefonso Guajardo – will each come to the table with different sets of proposals representing the interests of their own respective business sectors.
Mexico, a favored punching-bag for the U.S. president, will approach the table defensively. The country’s commercial dependency on the U.S. will likely translate into precious little leverage in the talks. Mexico has the most to lose from any protectionist measures imposed by Washington, as it sends 80 percent of its exports to its northern neighbor.
While the country’s goods surplus with the U.S. is about US$63 billion – a sharp increase from the US$1.3 billion surplus in 1994 – the country is also a major consumer of U.S. agricultural and processed food exports. U.S. administration officials say there is no deadline to reach an agreement, but Mexico is pushing for the sides to reach an agreement before its presidential campaign begins in earnest in February.
Canada likewise is comprehensively enmeshed in NAFTA, and the Liberal administration of Justin Trudeau is deeply committed to ensuring the talks’ success. The country is the largest export market for the U.S. According to Freeland, Canada hopes to transform NAFTA into a “fair trade deal” that includes a range of chapters addressing gender and Indigenous rights, as well as climate change. Critics, both left and right, have scoffed at ambitions to turn the talks into an opportunity to push a “progressive” agenda, considering the far-right bent of the White House.
Manuel Perez-Rocha of the Institute for Policy Studies points to the gap between Trump’s superficial “jobs, jobs, jobs” promises which feigns appeal to worker’s interests, and his cabinet, which is filled with bankers and figures from the corporate world.
"We cannot allow the trade policies that replace it to put the interests of multinational corporations first, as the renegotiation of NAFTA under a Trump administration teeming with corporate interests is positioned to do,” said Manuel Perez-Rocha of the Institute for Policy Studies. “Trump has promised that the NAFTA renegotiation will create jobs in the United States, but if corporate elites are allowed to dictate the renegotiation, Trump’s false economic populism will result in Americans facing job loss, wage stagnation, and eroding working conditions, especially for low-income workers and workers of color.”
“We need an internationalist approach to trade that lifts up labor rights, environmental standards, and human rights for people in all of the nations involved in the agreement, and provides good jobs for workers in the U.S.,” he continued. “Trump wants to allow corporations to pit U.S. workers against other working communities in a global race to the bottom."
Wallach agreed while urging Trump to make good on past promises to protect U.S. workers.
“With talks starting, the administration must decide between the corporate lobby and working people,” Wallach said. “The administration approach either will expand the old job-killing model as the corporate lobby demands or it will replace NAFTA with a deal that creates jobs and raises wages as the American people expect.”
For author and sociology professor William I. Robinson, there’s no question that a deal renegotiated by a far-right Trump administration and his neoliberal counterparts will favor corporations, banks, and the “transnational capitalist class.”
“The Trump family’s business empire spans the globe, including factories in Mexico that take advantage of cheap labor and export back to the United States, thanks to the provisions of NAFTA,” Robinson wrote for Truthout.“(B)eyond public discourse, there is nothing populist in the policies that the Trump government has so far put forth.”
“Trumponomics involves deregulation, slashing social spending, dismantling of what remains of the welfare state, privatization, tax breaks to corporations and the rich, and an expansion of state subsidies to capital – in short, neoliberalism on steroids.”