Wilson: U.S. has diverse, if not conflicting goals, with NAFTA renegotiations

LAREDO, Texas – The United States has a diverse if not a conflicting set of goals as it renegotiates the North American Free Trade Agreement with Canada and Mexico, says Chris Wilson of the Mexico Institute.

Wilson gave the keynote speech at a dinner during the 24th Annual Logistics and Manufacturing Symposium held at Texas A&M International University.

This is a unique trade negotiation. The United States has never decided to renegotiate a trade agreement before. So, this is a first in that sense,” Wilson told the Rio Grande Guardian.

“What is really unique about it is that the United States comes in with a diverse set or probably even a conflicting set of goals. On the one had their goal is to expand trade, to expand market access in Mexico and Canada, to introduce more market access for financial services, telecom services, agricultural goods, that is a more traditional trade agenda and a liberalizing agenda. But, on the other hand there is a U.S. agenda that is aiming to restrict trade, that is concerned about balancing the deficit, getting rid of the deficit.”

Wilson said there are only two ways to lower the deficit. “You either expand exports, which would be the traditional model of a trade negotiation, or you limit imports. That is where the U.S. objectives could run into direct conflict with Mexico and Canada and their real interest in maintaining the benefits of the free trade agreement.”

Two rounds of renegotiations have already been completed, with a third set to take place in Canada next week. “Most of the difficult issues in the renegotiation are still ahead. We will be looking at specific things, like Rules of Origin, Dispute Resolution, that will be on the table in these coming rounds of the negotiations,” Wilson said.

Asked if there is any way a renegotiation of NAFTA could be achieved that satisfies all parties, Wilson said: “That is much more a political dynamic and a political question as it is an economic one. What we really need, is, ultimately, for President Trump to go from being the person who said NAFTA was the worst trade agreement ever negotiated to updating it and making it his and him taking ownership of it and him selling it to his constituents.”

Wilson said there is a group of people in the United States who are frustrated with the process of globalization, frustrated with the loss of manufacturing jobs in the United States.

“I have to say that it is unfortunate we are trying to tackle that issue through NAFTA because I think there is very little that an updated NAFTA can do to change the direction of manufacturing jobs in the United States. I think that would need a conversation about workforce development and about training programs for workers. What we can do is change the dynamics of the conversation,” Wilson said.

“If the U.S. administration can have some sort of an argument that they have a plan in place to reduce the deficit, while maintaining the benefits of NAFTA that so many U.S., Canadian, and Mexican companies and workers depend on, we can probably get through this and through a complicated, narrow, path find a way to a successful renegotiation.”

As he prepared to give his keynoted address, Wilson was asked how the audiences differ when he gives speeches about NAFTA and international trade on the border, as compared to Washington, D.C.

“Here in Laredo we are at ground zero for NAFTA. If you ask where are the winners of NAFTA they are here. Communities like Laredo that facilitate massive amounts of trade, that are involved in manufacturing along the border. There is no real debate about whether NAFTA is a positive thing here,” Wilson said.

“In Washington, there is strong representation by companies, workers, that depend on NAFTA. Where we see a concentration of a rejection or frustration with NAFTA and globalization is in what some people call the Rust Belt states in the Upper Midwest, states that have experienced this process of deindustrialization and who are not quite sure who to blame for that. Incorrectly, but easily, Mexico ends on the losing side of that conversation.”

Mexico City Visit

Another speaker at the two-day symposium was U.S. Rep. Henry Cuellar. His participation included a panel discussion on “energy renaissance in North America.” After the symposium, Cuellar was slated to go to Mexico City.

“We are going to talk about NAFTA and the importance of the treaty,” Cuellar said of his visit to Mexico City. “We want to get the Mexican perspective and for them to hear our perspective. We will also be talking about what the next steps are, after the negotiations are concluded. We have to get it passed in Congress and that is not going to be easy.”

Cuellar said his visit would include meetings with the U.S. Ambassador to Mexico, Roberta Jacobson, and Tamaulipas Governor Francisco Garcia Cabeza de Vaca, as well as officials with U.S. Customs. “We want to talk to them about the day-to-day processes at land ports of entry,” Cuellar said.

With regard to energy, Cuellar said: “NAFTA has to take into consideration our energy relationship with Mexico. We are exporting a lot of natural gas to Mexico. That is going to increase as we lay more pipelines. I would hope NAFTA has a good section on energy, just in case anything happens and changes politically in Mexico. We need to have it in this agreement. With the energy reforms, there are a lot of new prospects. If you look at the work the U.S. can do, the work Mexico can do, and Canada, there is no doubt North America can be the new Middle East when it comes to energy.”

Also slated to visit Mexico City was Laredo Mayor Pete Saenz. The Rio Grande Guardian interviewed Saenz soon after he had heard a keynote lunchtime address by former U.S. Customs and Border Protection Commissioner Alan D. Bersin.

“Commissioner Bersin’s address was the kind of vision we need for the border. It was very inspiring. One Border, One Voice is hard to do but we have to strive for this,” Saenz said. “Sometimes it is hard to unite all the groups.”

Saenz said a private meeting was held between elected officials and business leaders at the symposium. He said the general consensus was that border leaders had to rally behind “low-hanging fruit” such as NAFTA, rather than also take on immigration reform. Saenz did not appear to support such an approach.

“Sooner or later we are going to have to be prepared to tackle immigration because at some point it is going to erupt. We have to come to grips with it. The sooner we get to comprehensive immigration reform, the better,” Saenz said.

Appearing on the same panel discussion with Saenz was state Rep. Richard Peña Raymond of Laredo. Raymond recalled the times he and his good friend Henry Cuellar had the challenge of persuading their Democratic colleagues to embrace NAFTA. He said this occurred at the time President Clinton signed NAFTA into law. That was 24 years ago.

“I am very proud of Laredo and Nuevo Laredo. We have shown for many years that we do work very closely together,” Raymond said. “The future looks good. But, we have got to make sure, and this is what this conference is about, we get NAFTA right. If we don’t there will be a lot fewer people at this conference next time we have one.”

Editor’s Note: The main image accompanying the above story shows panelists at the 24th Annual Logistics and Manufacturing Summit. From left to right: Laredo Mayor Pete Saenz, state Rep. Richard Peña Raymond, Tamaulipas Secretary of Economic Development Carlos Talancon, and Nuevo Laredo Mayor Enrique Rivas. The panel discussion was titled “Bi-National Conversation.”