President Donald Trump wants to replace NAFTA with an agreement he says would be more beneficial to the United States.
Trump's remarks helped the Mexican peso stem its losses, a reflection of how closely markets are watching efforts by the United States, Canada and Mexico to revamp a 1994 pact that the USA president has frequently threatened to abandon.
Trump, vowing to undo what he portrays as disastrous trade deals, has in recent days expressed different views of the North American Free Trade Agreement, stoking investor worries that one of the world's largest trading blocs may be disrupted.
This week, the Trump Administration struck by imposing new tariffs on Chinese made washing machines and solar panels.
01/24/2018Agriculture Secretary Sonny Perdue told reporters that President Trump has come to see that NAFTA has some benefits to the USA, particularly for farming, even as he stays firm in his demand for a new deal.
One of these is the US proposal that American-made autos be increased to monopolize 50 percent of the market, thereby qualifying for duty-free status. Trudeau said Tuesday at the World Economic Forum in Davos, Switzerland that they are really burning the midnight oil to make the neighbor to the South understand how good NAFTA is and that it has a vast benefit for the economy world over.
Mexico's chief negotiator took a similar position.
"We believe it is unlikely that the USA will exit the treaty in the months to come", the brokerage said.
The NAFTA talks have deadlocked over contentious demands from Washington that Canada and Mexico oppose, as do many in the business community. Canada now sends 75 percent of its goods exports to the United States.
The United States is also receiving pushback over its desire to include a sunset clause, which would cause the deal to automatically expire after five years unless it is renegotiated.
The sixth round of negotiations to update NAFTA is beginning in Montreal the chambers of commerce from all three countries stressed that free trade keeps them prosperous and creating jobs.
Canadian Prime Minister Justin Trudeau is now attending the World Economic Forum meeting in Switzerland to drum up investment.