The NAFTA timeline has become indeterminate



It was a timeline that was described as aggressive and fast, but not totally impossible. Early in the NAFTA renegotiations, everyone recognized that attempting to complete the negotiations within a seven month timeline was going to be difficult, but optimists thought our economic bond would win in the end.

The July 1st Mexican election and the U.S. mid-term elections have always been goal posts for these talks, never mind the overhanging threats by the President to trigger a NAFTA withdrawal countdown as a strategy to push Canada and Mexico to meet his demands. The President’s Art of the Deal double hyperbole negotiation strategy has done little to buckle Canada and Mexico.

As we get closer, there are more questions about how firmly those goal posts are planted.

“I understand that a lot of things are hard to negotiate prior to an election. They have an election coming up fairly shortly. I understand that makes it a little bit difficult for them. There’s no rush, I would rather be able to negotiate than begin a withdrawal,”said President Trump in an interview with the Wall Street Journal last week.

READ: Four Scenarios if Trump Withdraws from NAFTA

Canadian Foreign Affairs Minister Chrystia Freeland jumped to accept the President’s adjustment on the timeline by telling the press pool “I thought that was a sensible suggestion from the President. I think all of us are mindful of the Mexican elections.”

Reuters reports that Freeland added that Canada has “always felt that imposing artificial deadlines was not necessary from the Canadian standpoint,” adding: “I thought that was a constructive proposal from the president.”

And there it is, more uncertainty…

This has become the most uncomfortable wedding dance. We clearly like each other, and have differences, but we know family is important. The song is going on too long, but we all have no idea how to get off of the dance floor without looking bad.

Trump’s sudden sympathy for the Mexican constraints seems like odd timing based on his typical hard line negotiating tactics. Given his past, you can bet the new-found flexibility in the timeline is more about what he needs and not to satisfy anything concerning Mexico.

Meanwhile, I’ve been trying to put my finger on why Ted McKinney has been attempting to make Canada look like it’s responsible for stalling the talks. It appears it has become clear to the U.S. that Canada is not just going to roll over and accept its terms, so McKinney started to create a narrative that Canada is not taking the talks seriously. Canada used this same strategy early in the talks to get the U.S. to show some of its cards.

Although the uncertainty isn’t ideal, there is little advantage for Canada and Mexico to walk away from the negotiations and NAFTA altogether. Both Canada and Mexico seem to be in sync that if President Trump wants to exit the deal he should do it himself.

Trump has made these negotiations difficult, as he promised. Canada and Mexico have waited and now that we are at a critical point where Trump could pull the pin, terminate to renegotiate, and he apparently won’t.

It appears that he has gotten cold feet.

This could be due to the challenges of pleasing both sides of his base. The outcome of a withdrawal seriously jeopardizes his relationship with the agricultural base, only to satisfy the rust belt. Keeping the deal as is will break a major campaign promise to the rust belt states.

He has a dilemma and the only person to blame for putting him in this position is himself.

Trump created this whole we are going to win scenario and strategy. For the sake of his campaign-style speeches, his base approval ratings, and the U.S. economy, we may be at the point where stalling and an indefinite timeline is the best option for the President.

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