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Closing Statement of USTR Robert Lighthizer at the Fourth Round of NAFTA Renegotiations

October 17, 2017

Ambassador Lighthizer:

We have now had four rounds and 22 days of negotiations.  This has all been squeezed into just over two months.  The amount of work by all negotiators from the three countries is extraordinary. 

I should also thank the congressional and cleared advisors.  They have reviewed and helped us with hundreds of pages of very technical text.  Nearly everyone involved has been working 12-hour days more or less continuously. 

The United States had two objectives in these talks.  First, we wanted to update a 23-year-old agreement to reflect our modern economy.  Obvious areas for modernization included intellectual property, digital trade, anticorruption, technical standards, financial services, and others. 

Our President has been clear about our second objective.  NAFTA has resulted in a huge trade deficit for the United States and has cost us tens of thousands of manufacturing jobs.  The agreement has become very lopsided and needs to be rebalanced. We of course have a five-hundred billion dollar trade deficit. So for us, trade deficits do matter. And we intend to reduce them.

Frankly, I am surprised and disappointed by the resistance to change from our negotiating partners on both fronts.  We have made some headway on the first objective, but even here we have sometimes seen a refusal to accept what is clearly the best text available in spite of the countries having agreed to it in the past.

In certain cases, partners who agree to TPP have actually rejected its text here.  I would have thought by now we could have cleared chapters dealing with digital trade, telecommunications, anticorruption, and several sectoral annexes, for example.

As difficult as this has been, we have seen no indication that our partners are willing to make any changes that will result in a rebalancing and a reduction in these huge trade deficits.  Now I understand that after many years of one-sided benefits, their companies have become reliant on special preferences and not just comparative advantage.  Countries are reluctant to give up unfair advantage. 

But the President has been clear that if we are going to have an agreement going forward, it must be fair to American workers and businesses that employ our people at home.

Continuing to design a national manufacturing policy that is largely dependent on exports to the United States without balance cannot long continue.  It is important also to remember that to some extent, NAFTA is an investment agreement, and it is unreasonable to expect that the United States will continue to encourage and guarantee U.S. companies to invest in Mexico and Canada primarily for export to the United States. 

All parties must understand this and be reasonable if there is any chance for these negotiations to be successful.  I think we should all take the time between now and our next round to realistically assess what can be done to arrive at a balanced, modern agreement.  And I am hopeful that if we do that, we’ll have a successful conclusion to this project in due course.

I’d like to again thank both of my colleagues for your hard work, and I guess probably even more thank their colleagues [negotiators], who have done the lion share of the work over the last months.

I look forward to seeing you all in Mexico City.

Thank you.