U.S. and Mexico Reach Bilateral Deal on NAFTA

Mexican Foreign Minister Luis Videgaray (L) and Mexico's Secretary of Economy Ildefonso Guajardo leave the Office of the US Trade Representative after a day of meetings on the NAFTA treaty

Mexico and the United States are hammering out the final details of a bilateral deal to revise the North American Free Trade Agreement, according to people familiar with the state of negotiations. A formal announcement is expected Monday.

President Donald Trump tweeted about the deal Monday morning.

The United States and Mexico have been negotiating a deal without Canada’s involvement for several weeks. Negotiators met all last week and spent Saturday and Sunday ironing out the final details on a deal Sunday. The revised deal includes new rules on the portion of cars that would have to be made in North America to qualify for duty-free treatment under NAFTA.

Under the revised terms of the agreement, 75 percent of a car would have to be manufactured in North America, up from 62.5 percent under current rules, according to a person familiar with the talks. The new rules would also impose a sort of minimum wage for car makers, requiring that workers earn a minimum of $16 per hour to qualify for zero tariffs.

On his way into the negotiations Monday, Mexico’s chief trade negotiator Ildefonso Guajardo told reporters Monay here was just “one more important item” to discuss, the Wall Street Journal reported.

The details of the deal are not expected to be released until they are presented to Canada.

Over the weekend Trump hinted that a deal was close to being completed.