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Some U.S. and Canadian diplomats who were in Havana between 2016 and 2018 are still not fully recovered from ailments they suffered

U.S. Embassy building in Cuba [department de Estado] [ de Estado]

▲ Building of the U.S. Embassy in Cuba [department de Estado].

ANALYSIS / Eduardo Villa Corta

Three years ago, staff U.S. diplomats stationed in Cuba began to feel physical discomfort supposedly caused by strange sounds to which they had apparently been exposed; Washington spoke of a "sonic attack. However, although the symptoms suffered by those affected have been determined to be anomalous, it has not been possible to establish what caused them. Was it really an attack? Who was behind it? We review here the main hypotheses and conjectures that have been made, and point out their weaknesses.

In late 2016 and early 2017, several U.S. diplomats stationed in Havana, as well as members of their families, reported suffering from dizziness, vertigo and sharp pains in their ears that could be caused by strange sounds to which they had been exposed. According to their testimonies, the sounds came from a specific direction, and they had heard them in their own residences or, in some cases, in hotel rooms, while people staying in neighboring houses or adjoining rooms had not heard any special sounds. The phenomenon also affected Canadian diplomats in the Cuban capital. In all, some forty people were treated for these symptoms.

Acoustic attack

Echoing the facts reported by its staff in Cuba, in mid-2017 the U.S. State department stated that the symptoms could have been caused by a sonic attack by the Cuban government directed against diplomats and their families. In October 2017, President Donald Trump directly accused Havana: "I believe Cuba is manager; yes, I do."

At the beginning of 2018 the department of State issued a statement alert not to travel to Cuba due to a possible health crisis and withdrew a good part of the staff of the mission statement diplomatic in Havana, reducing the activity of this to the minimum possible. At that time, a total of 24 Americans had been affected.

At the time, the Canadian government also indicated that its diplomats had experienced similar discomfort. Ottawa decided to evacuate the families of its employees in Cuba and in early 2019 proceeded to reduce the staff of the embassy in the face of what appeared to be the appearance of a fourteenth case.

The Cuban government denied from the outset being involved in any harassment operation against the U.S. or Canada. ˝There is no test about the cause of the reported ailments, nor is there any evidence to suggest that these health problems have been caused by an attack of any kind˝, Havana assured. Raul Castro's government offered its cooperation in the research of the facts, with nothing coming to light that could explain the case. No devices that could have provoked the sounds appeared.

Adding confusion to the status, at least two US diplomats stationed in China, busy at the consulate general in Guangzhou, the largest that the US has in the country, presented in early 2018 also the symptoms already described. Washington evacuated them and issued a health warning about missions in mainland China.

The Associated Press published in October 2017 a recording of the alleged sounds causing the reported ailment, and indicated that government agencies had been unable to determine the nature of the noise and explain its relationship to the bodily disorders caused. Months later, he noted that internal FBI reports did not even establish that there had been an "attack". Other media highlighted the poor cooperation in the research, due to jurisdictional zeal, between the department of State, the FBI and the CIA.

Symptoms of "Havana syndrome".

A medical team from the University of Pennsylvania, at the request of the U.S. Government, examined 21 people affected by what the press began to call "Havana syndrome". The research, initially published in March 2018 in the Journal of the American Medical Association (JAMA), indicated that most of the patients reported problems with report, concentration, and balance, and determined that they appeared to have suffered injuries to extensive brain networks.

data Further MRI scans of the same team extended to 40 patients, released in July 2019, led to the conclusion that the diplomats had experienced some craniocerebral trauma. The results of the MRI scans, compared with those of a group of healthy people, showed differences in the volume of the white and gray substances of the brain, in the integrity of the cerebellar microstructures and in the functional connectivity of the subnetworks for hearing and spatial vision, but not for executive functions.

This report concluded that the staff diplomat had been physically injured, although it could not determine the cause. He also noted that patients do not experience a usual recovery, as they are not recovering quickly from symptoms, as is the case in other cases of similar "concussions" or ear problems.

IF IT WASN'T AN ATTACK, WHAT WAS IT?

As no clear cause has been established as to what caused the ailments suffered by the US and Canadian diplomatic staff and some members of their families, the very reality of an attack has been called into question. Although various alternative explanations have been put forward, none of them are fully convincing.

1) Collective hysteria

Formulation. Some neurologists and sociologists, such as Robert Bartholomew, have suggested that it could be a case of mass hysteria. Given the pressure to which some of the diplomats working in very unfriendly environments are subjected, and the endogamic relationship in which they live, living almost exclusively among themselves, it could explain a mutual conviction of an external attack that even has somatic consequences.

Weak spot. Both the research of the University of Pennsylvania and the doctor of the department of State, Charles Rosenfarb, who appeared before the committee of Foreign Relations of the Senate, came to rule out that the symptoms suffered by the diplomats were due to a mere mental mechanism. It is very difficult that about sixty people, including Americans and Canadians, convinced each other of an aggression of this kind subject and then almost all of them developed the same brain lesions.

2) Microwave

Formulation. The researcher team at the University of Pennsylvania, while not pointing to any possible cause of the ailments, did not rule out certain assumptions, such as that of microwave affectation. This aspect was insisted upon by a research published in 2018 in the journal Neural Computation, which considered the symptoms consistent with exhibition to electromagnetic microwave (RF/MW) radiation.

Weak point. Not all the symptoms shown by patients could be a consequence of the exhibition of such a radiation subject, which also has a diverging literature on its effects on the human body. In addition, there is no known microwave weapon that can affect the brain.

3) Ultrasound

Formulation. A team of computer experts at the University of Michigan suggested in 2018 that it could be a case of exhibition to some subject ultrasound, perhaps coming from malfunctioning listening equipment mixing multiple ultrasonic signals.

Weak point. The recording of one of the sound episodes - the sample broadcast by AP - is not sufficient to be able to determine its nature. It is also possible that the sound was somewhat different in other cases.

4) Crickets

Formulation. A research from the Universities of California-Berkeley and Lincoln, from the existing sound sample , considered in January 2019 that the possible cause of the attacks was made by cricketsThe study, specifically crickets Anurogryllus muticus. The research was a comparative study between the sound emitted by that variant of crickets and the sample of one of the Havana acoustic episodes.

Weak point. The sound perceived by the diplomats was directional, so it was not heard by neighboring people. If they had been crickets in their natural environment, the sound would have spread around.

5) Neurotoxins

Formulation. A joint study by two Canadian research centers in May 2019 attributed the symptoms suffered by diplomats to exhibition to neurotoxins from pesticides used to spray mosquitoes, a internship common occurrence in embassy buildings.

Weak point. The diplomats affected related the beginning of their physical discomfort to situations experienced in their own residences or in hotel rooms, where there was no fumigation.

IF IT WAS AN ATTACK, WHO DID IT?

Given that the previous explanations do not seem entirely solid, the US Government maintains the hypothesis of an attack. If it really happened, who was behind it? Here, too, there are various conjectures.

1) Castro regime

The first option considered, assumed in principle by the US given the public accusations made from Washington, has been to attribute the alleged attacks to the Cuban regime itself. With them, Havana would try to maintain pressure on the Americans, in spite of the formal reestablishment of diplomatic relations, with the goal to mark each other's territory.

Weak point. The incidents began to occur during the Obama Administration, in a context of a ˝honeymoon˝ marked by the reopening of embassies and the visit of Barack Obama to Havana. The normal thing is that at the end of 2016, in view of the U.S. elections, the Castro regime would not want to give reasons to the next U.S. president to twist the diplomatic line opened by Obama. It could make sense that after Donald Tump's later revocation of the previous openness measures, Cuba would want to punish the new Administration, but not before seeing the direction it would take; in any case, the attacks would only justify the hard line followed by Trump, which does not benefit the island.

2) A sector of Castroism

Fidel Castro was attributed with an unaccommodating attitude towards his brother Raul's decision to reestablish diplomatic relations with the United States. Although he died in November 2016, people around him might have tried to torpedo that rapprochement, convinced that hostility with Washington was the best way to ensure the survival of the regime as conceived by its founder.

Weak point. Although Fidel Castro's reluctance towards rapprochement with the U.S. is true, it is difficult to think that the most conservative sector within Castroism would dare to boycott so directly Raul Castro's fundamental political line. It is another thing that, after he handed over the presidency of Cuba to Miguel Díaz-Canel in April 2018, some sectors within the regime could make internal movements to send certain messages, but the changeover occurred when most of the acoustic episodes had already taken place.

3) A third country (Russia, China)

The third option would be that a third country generated the attacks. American intelligence indicates that the most viable option in this case would be Russia. Moscow has been keen to return to operating in the Caribbean, as in the Cold War, and aggression against U.S. diplomats in Cuba would fit in with its strategy. It has also been suggested that China might want to repay Washington in its backyard with the same harassment that the Chinese believe they feel from the US in their nearest seas.

Weak point. The return of Russia to the Caribbean is certainly documented, and it is conceivable that Moscow could have promoted a punctual action against some specific goal , but it seems difficult that it would have sustained over time an operation that harms Cuba's sovereignty. As for China's presence in the US neighborhood, it is a less confrontational move than the one carried out by Russia. Moreover, if Beijing had chosen foreign soil in order to better erase the traces of an action against US diplomats, then the cases recorded in Guangzhou would not have occurred.

Categories Global Affairs: North America Security and defence Articles Latin America

NAFTA: Half a year of renegotiation without major progress

▲Presidents Enrique Peña Nieto and Donald Trump, in the latest G20 Summit; Hamburg, July 2017 [Presidency of Mexico].

ANALYSIS / Dania Del Carmen Hernández [English version] [Spanish version].

Canada, the United States and Mexico find themselves immersed in the renegotiation of the North American Free Trade Agreement (NAFTA). The trade treaty between these three countries has been controversial in the past few years, especially in the US, where many have doubted its benefits. During the presidential campaign, Donald Trump defended the complete elimination of the treaty; subsequently, when already in the White House, he agreed to make the renegotiation happen. President Trump argues that the pact has hollowed out US manufacturing and caused a trade deficit of over $60 billion with Mexico ($18 billion with Canada), so unless he can rework it in favor of the United States, he said, he won't hesitate to withdraw from it.

Overall, the American people have pretty positive views on the treaty, with 56% of the population who say that NAFTA is beneficial to the country, and just a 33% who say it's bad, according to a poll conducted by Pew Research in November 2017. Out of those who have a negative view, the majority are Republicans with 53% of them claiming Mexico benefits more, compared to Democrats who are generally more supportive of the trade pact and with just 16% who agree with the Republicans on that matter.

 

U.S. Trade in Goods with Mexico

 

Regardless of public acceptance, opinion on the treaty hasn't always been so dubious. When President Bill Clinton signed it into law, it was actually considered one of the first successes in his presidency. The same way globalization has liberalized trade all over the world, NAFTA effectively expanded trade and presented a great number of opportunities for the US, all while strengthening the country's economy.

Under NAFTA, US trade in goods and services with Canada and Mexico went from $337 billion in 1994 when the treaty came into force, to about $1.4 trillion in 2016. Under NAFTA, cross-border investment among the three member countries has surged as well, from $126.8 billion in 1993 to $731.3 billion in 2016.

The concern in Washington is that, despite of the increasing volume of trade, in relative terms the US isn't getting fruitful enough results, compared to what its neighbors are getting from it. In any case, Canada and Mexico accept that, almost after 25 years of validity, the agreement must be revised to be able to adapt it to the new productive and commercial conditions, defined by technological innovations that, as is with the case of the development of the internet, were not contemplated when the treaty was signed.

Round to round examination

The discussion between the three countries affects numerous aspects, but we can talk about three main blocks that have to do with certain network lines set by the different parties in the negotiation: rules of origin; the desire of the United States to end the independent system of arbitration, through which Canada and Mexico can terminate the measures that might violate the treaty (elimination of Chapter 19), and finally other proposals, perhaps less decisive but equally important, oriented towards the general wish to update the agreement.

When the negotiations started, in August 2017, the countries expressed a concern to reach a final decision in January 2018. The plan was to have six rounds of meetings. That number has been already overcome: a seventh round is happening at the end of February and there will be possibly more. As we have reached the initial deadline an examination on the state of the discussion is relevant. A good way of doing it is following the evolution of the conversations through the rounds of meetings celebrated and this way we can evaluate the results that have been registered so far.

 

Latest North America Summit, with Presidents Peña Nieto and Obama, and Prime Minister Trudeau; Canada, June 2016

Latest North America Summit, with Presidents Peña Nieto and Obama, and Prime Minister Trudeau; Canada, June 2016 [Presidency of Mexico].

 

1st Round (Washington, D.C.; August 16-20, 2017)

The first round of negotiations set the priorities for each of the three countries on the table; it served to fixate the diary of the principal issues that would be discussed later on, without going into much detail about the measures and the how- to's.

In the first place, Donald Trump had already set clear during his campaign that he considered NAFTA an unjust agreement for the United States, due to the trade deficit that the country has mostly with Mexico, and to a lesser extent, with Canada. According to the Office of the United States Trade Representative (USTR), the US went from a surplus of $1.3 billion in 1994 to a deficit of $64 billion in 2016. The major part of this deficit comes from the automotive industry. For the new administration, this puts in doubt that the treaty may have beneficial effects on American economy. Mexico, less predisposed to introduce important changes, insists that NAFTA has been good for all parties involved.

Another topic that was noted was Mexico's salary gap against the US and Canada. Mexico defends that, despite having one of the lowest minimum wages in South America, and having had their medium wage stuck during the two past decades, this shouldn't be taken into account in the negotiations, for it is estimates that Mexican salaries will eventually reach those of their commercial partners. On the contrary, for the US and Canada, this remains a matter of concern; both countries insist that a wage increase would not damage Mexican economy.

Rules of origin was one of the principal recurring topics of discussion. The United States is looking for augmentation in the percentage of content that is required to consider a product as of origin so that it won't be necessary to pay tariffs when moving it between the three countries. This proved to be rather controversial in this first round, as it could negatively affect Mexican and Canadian companies. Specialists have made the remark that a minimum of national content does not exist in any free trade treaties in the world.

Lastly, Trump's administration let their intentions of eliminating Chapter 19 show. A section of the treaty which guarantees equality in the solving of disputes between the countries, making it so that it isn't national laws what will dictate the outcome. The US understands it as a threat to their sovereignty and believes that conflicts should be resolved in a way in which their own democratic processes wont be ignored or jeopardized. For their part, Canada conditioned their permanence in the treaty with the maintenance of the chapter. Mexico also defends guarantees of independence in the resolution of conflicts even though for the moment it hasn't been categorical in this discussion, since it lingers on the side, and will act accordingly to what results most favorable.

 

Main diary

 

2nd Round (Mexico City; September 1-5, 2017)

Although considered successful by many analysts, the second round of the renegotiation followed a very slow pace. Some of the matters that made advances were: wages, access to markets, investment, investment, rules of origin, commercial facilitation, environmental issues, digital commerce, SME's, transparency, anti-corruption laws, agronomy and textiles.

The president of Corporate Coordinating Council in Mexico, Juan Pablo Castañon, insisted that for now the salary issue wasn't up for negotiation, and rejected the idea that any of the parties had the intention of pulling out of the treaty, despite the previous threats from the Trump administration. Castañon rallied in favor of Mexico supporting the maintenance of Chapter 19 or the establishment of a similar instrument with the purpose of solving commercial controversies amid the three countries.

3rd Round (Ottawa; September 23-27, 2017)

The delegates made important advances in competition policies, digital commerce, state-owned companies and telecommunications. The principal development had to do with some aspects related to SME's.

The Canadian chancellor, Chrystia Freeland, criticized that the United States had not made any written formal proposals on the most complex areas, demonstrating a passive attitude of the country in the context of the negotiation.

The US trade official, Robert Lighthizer, said that his country is interested in increasing the salaries in Mexico to avoid an unfair competence, seeing that Mexico has attracted factories and investments with their low salaries and their weak trade-union regulations.

Canada endured a firm posture on Chapter 19, which they consider one of the greatest achievements of the current agreement. "Our government is absolutely committed to defending it," said Freeland. Washington requested, though without presenting a formal proposal, the modification of the rules of origin so that they are more strict, avoiding that imports from other nations are considered "made in North America", just because they were assembled in Mexico.

This round took place while the United States fixed a tariff of almost 220% to the CSeries aircrafts by the Canadian manufacturer Bombardier, after considering that the enterprise had used a governmental subsidy to sell its plans to the United States at artificially low prices.

4th Round (Virginia; October 11-17, 2017)

The United States presented their formal proposal of elevating the rules of origin in the automobile industry and suggested introducing a termination clause in the treaty.

The US proposed raising the percentage of components of national origin from any of the three countries from 62.5% to 85% so that the production in the automobile industry can benefit from NAFTA. This way 50% of it will be American production.

It was also debated, in the interest of Washington, the weakening of the system of controversy resolution present in Chapter 19, which was done without registering an approximation of the positions.

To finish, they talked about a termination clause that would give the treaty five years of life and once that time was over, it would automatically disappear, unless, when the time came, the countries decided to renew it. This proposal received several critiques, many claiming that this could infringe the essence of the agreement and that every five years would generate uncertainty in the region, considering that it would affect the investment plans of companies.

These proposals just add to the harsh climax of the negotiation that had been present since the last round in which the US had started to defend difficult proposals like the trials for dumping (selling a product for a price below its normal price) in the imports of perishable Mexican products (tomatoes and berries, governmental and textile purchases.

5th Round (Mexico City; November 17-21, 2017)

 
GDP per capita US / Mexico / Canada
 

The fifth round didn't show too many advances. The United States kept their requests and that generated frustration amongst the representatives of Mexico and Canada.

The US didn't receive alternatives to its proposal to change the regional composition from a 62.5% to an 85%, and that at least 50% is American, On the contrary, its commercial partners showed the damage that this proposal could cause to the three economies.

Faced with the US' intentions to limit the number of concessions that their federal government offers to Mexican and Canadian enterprises, Mexican negotiators responded with a proposal to limit the country's public contracts to the number of the contracts attained by Mexican companies with other governments inside the NAFTA. Given that the number of those contracts is significantly reduced, US companies will see their contracting being restricted.

Upon completion of this fifth round, the topics that are now more developed are the ones that involve a regulatory enhancement of telecommunications and the chapter on sanitary and phytosanitary measures. With this last thing, Americans are looking to establish new transparent and non discriminatory norms, that will allow each country to establish the degree of protection they find appropriate.

6th Round (Montreal; January 23-29, 2018)

The Sixth Negotiation Round saw some progress. The chapter on corruption was finally closed, and progress was made in other fields. More importantly, we finally saw a discussion that involved some of the core issues that had been pushed back in the previous negotiations. The progression is slow, but steady.

Robert Lightizer rejected the compromise on rules of origin that Canada had previously proposed. The structure was based on the idea that the rules of origin should be calculated to also include the value of software, engineering and other high-value work, which is currently not counted toward the regional content targets. This would guarantee the safeguarding of high-paying jobs in the area. The US expressed its disapproval to the Canadian proposal. Mexico didn't find this surprising at all, as it already expected the cold shoulder from their American trade partner on this matter.

In another proposal, Canada made a threat as they claimed that they will keep the right to treat their neighbors worse than other countries if they enter into agreements. One of which could be China. The proposal was obviously not passed, as the US and presumably Mexico considered it 'unacceptable'.

Although the countries successfully worked towards installing measures against corruption during the round of negotiations, they were far from successful at reaching an agreement on the topic of modifying rules of origin and calculating the regional content of the country in which automobiles are manufactured. All three countries remain motivated to keep making progress and will resume the negotiations for a speculation of two more sessions before the deadline that has been set in March, in order to avoid interference with the presidential election in Mexico and the US midterm elections in November.

Beyond the deadline

After more than seven months of meetings, as we have seen in the round-by-round examination, the negotiations between the three countries still have not reached the pre-agreement threshold that, even waiting to resolve more or less important points, should confirm the shared will to give continuity to NAFTA. The hard positions of the United States and the pressure of Canada and Mexico to save the treaty have so far resulted in a 'tug-of-war' that has allowed some partial, but not decisive, result. Thus, it remains to be determined if the treaty has actually reached its expiration date or may be reissued instead. For the time being, the three countries agree to continue working towards a renewed treaty.

From what has been seen so far in the negotiations, it is difficult to determine which country will be more willing to give in to the pressure exerted by the others. The most controversial issues have barely been addressed until recently, so it is also not possible to point out what achievements each country achieves in this negotiating process.

The two neighbors of the United States, but especially Canada, continue to warn of Trump's risk to end the treaty. An acceleration of the negotiations could help the positive resolution of the process, but the electoral calendar rather threatens delays. On March 30 begins the campaign of the presidential elections in Mexico, which will take place on July 1. In September, the United States will begin to pay more attention to the November Mid-term elections. A substantial progress before the Mexican elections could put the agreement on track, although some issues should have to be agreed later, but if in the next meetings there is not a breakthrough, the three countries could get used to the possibility of ending NAFTA, what would harm the negotiations.

NAFTA: Half a year of renegotiation without major progress

▲Enrique Peña Nieto and Donald Trump at the July 2017 G20 summit in Hamburg [Presidency of Mexico].

ANALYSIS / Dania Del Carmen Hernández [English version].

Canada, the United States and Mexico are immersed in the renegotiation of the North American Free Trade Agreement (NAFTA). The trade agreement between these three countries has been somewhat controversial in recent years, especially in the US, where its advisability has been questioned. During the presidential campaign, Donald Trump defended the cancellation of the treaty; later, already in the White House, he accepted that there would be a renegotiation. Trump argued that the pact has reduced US manufacturing jobs and generated a trade deficit of more than $60 billion with Mexico ($18 billion with Canada), so unless new conditions substantially reduced that deficit, the US would withdraw from agreement.

Overall, Americans have positive views of the treaty, with 56% of the population saying NAFTA is beneficial to the country, and 33% saying it is detrimental, from agreement with a November 2017 Pew Researchsurvey . Among those who hold a negative view, the majority are Republicans, with 53% saying Mexico benefits the most, while Democrats overwhelmingly support the pact and only 16% view it negatively.

 

U.S. trade in goods with Mexico

 

Regardless of public acceptance, opinion about the treaty has not always been so dubious. When President Bill Clinton ratified the treaty, it was considered one of the greatest achievements of his presidency. Just as globalization has liberalized trade around the world, NAFTA has also expanded trade very effectively and presented a great issue of opportunities for the U.S., while strengthening the U.S. Economics .

Under NAFTA, trade in U.S. goods and services with Canada and Mexico grew from $337 billion in 1994, when the treaty entered into force, to $1.4 trillion in 2016. The impact has been even greater when taking into account cross-border investments between the three countries, which went from $126.8 billion in 1993 to $731.3 billion in 2016.

Washington's concern is that, despite this increase in trade volume, in relative terms the United States is not achieving sufficiently fruitful results compared to what its neighbors are getting from the treaty. In any case, Canada and Mexico accept that, after almost 25 years in force, the treaty must be revised to adapt it to the new productive and commercial conditions, marked by technological innovations that, as is the case of the Internet development , were not contemplated when the agreement was signed.

Round-by-round examination

The discussion of the three countries touches on numerous aspects, but three blocks can be mentioned, which have to do with certain red lines set by the different parties to the negotiation: the rules of origin; the desire of the United States to end the independent arbitration system, through which Canada and Mexico have the ability to end measures that violate the trade agreement (elimination of Chapter 19), and finally proposals, perhaps less decisive but equally important, aimed at the general update of the treaty.

When negotiations began in August 2017, it was expressed that they could be concluded by January 2018, with six rounds of meetings planned. This issue is already being exceeded, with a seventh round at the end of February, possibly to be followed by others. Now that the initial deadline has been reached, however, it is time to review the status of the discussions. A good way to do this is to follow the evolution of the talks through the rounds of meetings held and thus be able to assess the results that have been recorded so far.

 

Last North American Summit, with Peña Nieto, Trudeau and Obama, held in Canada in June 2016.

Last North American Summit, with Peña Nieto, Trudeau and Obama, held in Canada in June 2016 [Presidency of Mexico].

 

1st Round (Washington, August 16-20, 2017)

The first round of negotiations put on the table the priorities of each of the three countries; it served to set the diary of the main issues to be discussed in the future, without yet addressing concrete measures.

agreement First of all, Donald Trump already made it clear during his election campaign that he considered NAFTA to be unfair to the United States due to the trade deficit that the United States has mainly with Mexico and, to a lesser extent, with Canada.

According to figures from the Office of the US Trade Representative, the US went from a surplus of $1.3 billion in 1994 to a deficit of $64 billion in 2016. Most of this deficit comes from the automotive industry. For the new U.S. Administration, this calls into question whether the agreement will have beneficial effects for the domestic Economics . Mexico, less inclined to introduce major changes, insists that NAFTA has been good for all parties.

Another topic was the wage gap between Mexico and the United States and Canada. Mexico argues that, despite having one of the lowest minimum wages in Latin America, and having had a stagnant average wage for the last two decades, this should not be taken into account in the negotiations, as it believes that Mexican wages will gradually catch up with those of its trading partners. On the contrary, for the US and Canada it is a topic of concern; both countries warn that a wage increase would not harm the growth of the Mexican Economics .

Rules of origin was one of the main topics of discussion. The United States is seeking to increase the percentage of content required to consider a product as originating so that it is not necessary to pay tariffs when moving it between any of the three countries. This was controversial in this first round, as it could negatively affect Mexican and Canadian companies. Specialists warn that the minimum national content requirement does not exist in any free trade agreement in the world.

Finally, the Trump administration hinted at its intentions to eliminate Chapter 19, which guarantees equality in resolving disputes between countries, so that it is not the national laws of each country that resolve the conflict. The United States sees this as a threat to its sovereignty and believes that conflicts should be resolved in such a way that its own democratic processes are not ignored. Canada has conditioned its continued membership in the treaty on the maintenance of this chapter. Mexico also defends guarantees of independence in conflict resolution, although so far in this discussion it was not categorical.

 

diary main

 

2nd Round (Mexico City, September 1-5, 2017)

Although considered successful by many analysts, the second round of renegotiation continued at a slow pace. Some of the issues that advanced were: wages, market access, investment, rules of origin, trade facilitation, environment, digital trade, SMEs, transparency, anti-corruption, agriculture and textiles.

The president of committee coordinator Mexican Businessmen, Juan Pablo Castañón, insisted that for the moment the wage issue was not subject to negotiation, and denied that any of the parties had any intention of leaving the treaty, despite threats to that effect from the Trump Administration. Castañón said he was in favor of Mexico supporting the maintenance of Chapter 19 or the establishment of a similar instrument for the settlement of trade disputes between the three countries.

Round 3 (Ottawa, September 23-27, 2017)

The delegates made important advances in policies on skill, digital commerce, state-owned enterprises and telecommunications. The main progress was on some aspects related to SMEs.

Canadian Foreign Minister Chrystia Freeland complained that the United States had not made any formal or written proposals in the most complex areas, which in her opinion demonstrates a passive attitude on the part of that country in the context of the negotiations.

U.S. Trade Secretary Robert Lighthizer said that his country is interested in increasing wages in Mexico, under the logic that this is unfair skill , as Mexico has attracted factories and investment with its low wages and weak union rules. However, Mexican business and union leaders are resisting such pressures.

Canada stood firm on its position on Chapter 19, which it considers one of the great achievements of the current agreement. "Our government is absolutely committed to defending it," Freeland said. Washington raised, although without presenting a formal proposal , the modification of the rules of origin to make them stricter and prevent imports from other nations from being considered "made in North America", just because they were assembled in Mexico.

This round took place as the United States slapped a tariff of nearly 220% on C Series aircraft made by Canadian aircraft manufacturer Bombardier, which it considered that business had used a government subsidy to sell its aircraft to the U.S. at artificially low prices.

Round 4 (Virginia, October 11-17, 2017)

The United States presented its formal proposal to raise the rules of origin for the automotive industry and its suggestion to introduce a sunset clause to agreement.

The United States proposed raising from 62.5% to 85% the percentage of components of national origin from one of the three countries in order for the automotive industry to benefit from NAFTA, and that 50% be of U.S. production. association The Mexican Automotive Industry Association (AMIA) rejected proposal.

Washington's interest in weakening the dispute settlement system within the treaty (Chapter 19) was also debated, without a rapprochement of positions.

Finally, there was talk of including a sunset clause, which would cause the treaty to cease to exist after five years, unless the three countries decide to renew it. This proposal was widely criticized, warning that this would go against the essence of agreement and that every five years it would generate uncertainty in the region, as it would affect the investment plans of companies.

These proposals add to the tough negotiating climate, as already in the third round the United States had begun to defend difficult proposals, on issues such as lawsuits for dumping (selling a product below its normal price) in the importation of perishable Mexican products (tomatoes and berries), government purchases and the purchase of textiles.

 
GDP per capita United States / Canada / Mexico
 

Round 5 (Mexico City, November 17-21, 2017)

The fifth round took place without much progress. The U.S. maintained its demands and this generated great frustration among the representatives of Mexico and Canada.

The United States received no alternatives to its proposal of wanting to increase the regional composition from 62.5% to 85%, with at least 50% being U.S.-based. On the contrary, its trading partners put on the table data showing the damage that this proposal would cause to the three economies.

Faced with the U.S. desire to limit the issue of concessions that its federal government offers to Mexican and Canadian companies, Mexican negotiators responded with a proposal to limit the country's public contracts to issue of contracts reached by Mexican companies with other governments under NAFTA. Given that the issue of these contracts is quite small, U.S. companies would be restricted in their contracting.

At the end of this fifth round, the most advanced issues are the regulatory improvement of telecommunications and the chapter on sanitary and phytosanitary measures. With the latter, the Americans seek to establish new transparent and non-discriminatory rules, allowing each country to establish the Degree protection it deems appropriate.

Round 6 (Montreal; January 23-29, 2018)

The sixth negotiation showed some progress. The chapter on corruption was finally closed, and there was progress in other areas. Some of the important issues that had been left aside in the previous negotiations were discussed. Progress is slow, but seems to be making headway.

Robert Lightizer rejected the compromise on rules of origin that Canada had previously proposed. The framework was based on the idea that rules of origin should be calculated to include the value of software, engineering and other high-value work, facets that today are not taken into account with a view to goal regional content.

As a form of pressure, Canada threatened to reserve the right to treat its neighboring countries worse than other countries if they enter into agreements. One of them could be China. The proposal was not considered, as the United States and Mexico found it unacceptable.

Beyond the deadline

After more than seven months of meetings, as reflected in this round-by-round review of the talks, the negotiations between the three countries have still not reached the threshold of a pre-agreement that, while awaiting the resolution of more or less important points, would confirm the shared will to continue NAFTA. The hard stances of the United States and the pressure from Canada and Mexico to save the treaty have so far resulted in a "tug of war" that has allowed some partial, but not decisive result . Thus, it is yet to be determined whether the treaty has actually reached its expiration date or whether it can be reissued. For the time being, the three countries are at agreement working towards a renewed treaty.

From what has been seen so far in the negotiations, it is difficult to determine which country will be more willing to yield to the pressure exerted by the others. The most controversial issues have hardly been addressed until recently, so it is not possible to say what each country has achieved in this negotiation process.

The two neighbors of the United States, but especially Canada, continue to warn of the risk of Trump wanting to kill the treaty. An acceleration of the negotiations could help the positive resolution of the process, but the electoral calendar rather threatens postponements. On March 30, campaigning begins for Mexico's presidential election, which will take place on July 1. In September, the U.S. will begin to look more closely at the November congressional elections. A substantial breakthrough before the Mexican presidential elections could put agreement back on track, even if some issues remain to be closed, but if no breakthrough is made in the next meetings, the three countries could be getting used to the idea of the end of NAFTA, which would weigh down the negotiations.

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