US and mexico closing in on north american free trade agreement deal

A possible breakthrough in negotiations between the U.S. and Mexico regarding the renewal of the North American Free Trade Agreement is expected to open the way for larger talks between those two countries and Canada.

For the U.S. construction industry, renewing NAFTA is seen as important due to the large amount of construction equipment passing between this country and Mexico.

The industry has been worried that such materials may increase in price if there is a reduction in such imports.

At the same time, roughly 30% of construction equipment made in the U.S. is sent to Mexico and Canada.

According to U.S. News & World Report, manufacturers in America sold more than $9.1 billion in construction equipment to Canada in 2015 and over $1 billion to Mexico during that same year.

The biggest sticking point for U.S. and Mexico negotiators has centered on rules governing automobile manufacturing.

The U.S. has been pushing for raising the amount of local content in North American-made vehicles. The U.S. wants to up the content requirement from its current 62.5% to 70%.

The talks have been overseen by U.S. Trade Representative Robert Lighthizer and Mexican Economy Secretary Ildefonso Guajardo.

Another issue yet to be resolved is a U.S. demand for a clause that would require that the agreement be automatically renewed every five years.

It is thought that a NAFTA agreement between the U.S. and Mexico may be only days away, but no final reauthorization of the agreement can go forward without the eventual participation and consent of Canadian trade officials.

By Garry Boulard