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Mexico may leave NAFTA if terms don't suit

Mexico could have "no other option" but to leave the NAFTA trade pact if renegotiations with the US don't give clear benefits to Latin American nation.

Mexico could pull out of the North American Free Trade Agreement if a renegotiation of its terms does not benefit Latin America's second-largest economy, Economy Minister Ildefonso Guajardo says.

"There could be no other option. Go for something that is less than what we already have? It would not make sense to stay," Guajardo said when asked on television if Mexico could pull out of the trade deal with Canada and the US.

"The strategy for this treaty needs to be one in which everyone wins. It's impossible to sell it here at home if there aren't clear benefits for Mexico."

US President Donald Trump has vowed to withdraw from NAFTA, which took effect in 1994, if he cannot renegotiate it to benefit American interests.

Trump formally withdrew the US from the Trans-Pacific Partnership on Monday and said he would renegotiate NAFTA "at the appropriate time".

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Guajardo and Foreign Minister Luis Videgaray will hold talks with senior Trump advisers this week in Washington over trade, security and immigration.

Mexican President Enrique Pena Nieto and Trump will meet at the end of January.

Videgaray said later on Tuesday that abandoning the treaty was always an option, but it was not what the Mexican government was aiming for as it sat down to discuss NAFTA.

Pena Nieto said on Monday he would aim to preserve tariff-free commerce under NAFTA in talks with the new US government, calling for the competitiveness of North America to be strengthened.

NAFTA and other trade deals became lightning rods for American voter anger in the industrial heartland states that swept Trump to victory in the November election.


2 min read

Published

Source: AAP



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