U.S. Trade Representative Robert Lighthizer heralded the newly forming U.S.-Mexico trade agreement described as better in every way than NAFTA and setting the rules with the “highest standards” of any agreement for the future.
“I think this is an extremely historic time,” Lighthizer said Monday on a call with reporters. He labeled NAFTA “seriously out of whack” in a way that “led to large trade deficits” and said it needed updating.
A senior administration official called the new U.S.-Mexico trade agreement “better in all respects” than “NAFTA 1.0.”
Lighthizer explained that up to 1,000 people were involved in the seven rounds of negotiations between the U.S., Mexico, and Canada over the course of a year. There were a lot of hurdles to clear in renegotiating a $1.2 trillion trade deal modernized “consistent with the way the economy works now.”
“We look forward to having this — either be joined by Canada or not,” said Lighthizer, who called the current bilateral agreement between the U.S. and Mexico “absolutely terrific.”
“I think it is fair to say we’ll do a rebalancing,” Lighthizer said. “I think it’s going to lead to more jobs for American workers and farmers but also more jobs for workers and farmers from Mexico.” He added that the new agreement modernizes automobile trade.
Of the new trade deal, Lighthizer told reporters, “I think it’s going to set the rules for the future at the highest standards in any agreement yet negotiated by any two nations for things like intellectual property and digital trade and financial services trade and all of the things that we think of as the modernizing, cutting-edge places that our economy is going.”
He went on to tout the benefits of the agreement for business and labor: “stronger and more enforceable labor provisions that have ever been in an agreement by a mile.”
Jared Kushner, President Trump’s senior adviser, chimed in, saying the U.S.-Mexico deal was done “in almost record time” for a trade deal.
Senior administration officials pointed to the deal as making both America and Mexico better off.
Lighthizer hopes for “overwhelming Republican and Democratic support” through the process in Congress on the deal, leading “to real, tangible benefits for our workers and our farmers.”
The U.S.-Mexico trade agreement includes a sunset provision alternative, according to a senior administration official who explained that the deal is for 16 years with a review after six years that allows for another 16-year extension. If after the review there is no consensus to renew, a review will be conducted every year until disagreements can be worked out and the parties agree to then renew for another 16 years.
The U.S.-Mexico deal includes more detailed rules of origin for automobiles deemed much better for the region and the U.S., according to a senior administration official.
“In areas like digital trade, financial services, IP, all of the kinds of things you think of as a new economy, we are setting newest high-level standards that are not only better than NAFTA 1.0, but are also better than TPP or, I would suggest, any other agreement that’s been negotiated,” said the administration official, who called the new agreement “innovative.”
The senior official repeated that the new trade agreement is not only better than the existing NAFTA deal, “but also far better than TPP.”
“There literally is not an area where we didn’t plus-up what we had done before,” the official emphasized.