The opportunity to reach a deal on a new North American Free Trade Agreement (NAFTA) this year has likely closed due to impending elections in Mexico and the United States, say observers who now expect that NAFTA negotiations will stretch into 2019.
Recent high-level talks between the U.S., Canada and Mexico failed and it is now unlikely that any new deal could pass Congress this year as there are midterm congressional and senate elections this autumn. The imposition last week of U.S. tariffs on Canadian imports of steel and aluminum didn’t help the negotiations either.
Any NAFTA deal this year “will not be ratified by this U.S. Congress. The procedural and political calendars are now closed,” said Dan Ujczo, a Columbus-based trade lawyer with law firm Dickinson-Wright. Reaching an agreement this year is also “unlikely,” he said.
U.S. House Speaker Paul Ryan had said, citing timelines set out in U.S. trade law, that Congress needed notice of intent to sign a deal by May 17. He then said there might be a couple weeks of wiggle room, placing the deadline right around now – early June.
Mexican elections are scheduled for July 1, with leftist Andres Manuel Lopez Obrador, known as “AMLO,” leading his nearest rival by more than 20 percentage points, according to Bloomberg’s poll tracker. His potential election — and that of a new Mexican Senate and U.S. Congress — could change the dynamic of talks and the type of deal that could have a chance of becoming law. No matter who wins, Mexico will have a new president on December 1, since Enrique Pena Nieto isn’t eligible for re-election.
