Mexico Bracing for Possible Demise of Nafta, Diplomat Says

  • The country is looking to increase trade ties with Asia
  • Canadian official says some bilateral negotiations make sense

Mexico’s government is preparing for the potential demise of the North American Free Trade Agreement as it looks to increase ties with Asia, according to a top diplomat.

“We are preparing for the scenario where we do not have a Nafta,” Kenneth Smith Ramos, director of the Nafta office at the Mexican Embassy in Washington, said at a trade conference on Thursday.

Mexico still holds out hope that it can protect and modernize the agreement, though officials oppose the idea of raising tariffs, he added.

The comments come as Mexico prepares to hold talks with U.S. President Donald Trump, who has threatened to withdraw from Nafta if his partners aren’t willing to renegotiate a deal that he blames for destroying American manufacturing jobs. Relations between the two countries soured last month when Mexican President Enrique Pena Nieto canceled a trip to Washington after Trump doubled down on demands that his southern neighbor pay to build a border wall.

Canadian ties with Trump have remained more positive, especially after Prime Minister Justin Trudeau visited the White House earlier this week. Gilles Gauthier, economic affairs minister at the Canadian embassy in Washington, said at the same forum on Thursday that it makes sense to renegotiate some details of Nafta bilaterally. He added that his country supports a progressive deal with labor and environmental safeguards.

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