Slow start to fifth round of NAFTA talks in Mexico City

A source with direct knowledge of the NAFTA talks in Mexico City says about a dozen different topics have come up so far, with little movement following the first full day of discussions.

U.S. showing no flexibility on procurement proposals that Canada and Mexico won't accept, source says

Canada's NAFTA negotiator Steve Verheul gestures to the media where the fifth round of NAFTA talks involving the United States, Mexico and Canada is taking place in Mexico City. (Carlos Jasso/Reuters)

NAFTA talks are off to a slow start in Mexico City, where the fifth round of discussions are underway.

A source with direct knowledge of the talks tells CBC News about a dozen different topics have come up so far, with little movement following the first full day of discussions.

The source pointed out that, so far, there have been no fireworks behind the scenes.

That's a change in tone from the last round in Washington, where American negotiators tabled five controversial demands that Canada would not support. Mexico has also shown similar resistance to some of the demands.

The so-called "poison pill" proposals include introducing a sunset clause, boosting made-in-America provisions in the auto sector, killing Canada's supply management system for dairy, restricting access to procurement contracts with the U.S. government, and dismantling the Chapter 19 dispute resolution process.

Procurement discussed on 1st day

The source said procurement was discussed on the first day of talks, and that the U.S. is showing no flexibility on its position, which is reported to be that Canada and Mexico's access should be on a "dollar-for-dollar" basis.

National flags representing Canada, Mexico, and the U.S. are lit by stage lights at the North American Free Trade Agreement renegotiations. The first day of this round resulted in little progress. (Canadian Press)

Canada's Foreign Affairs Minister Chrystia Freeland has publicly complained about the American demands on procurement, saying the proposals would give Canadian and Mexican companies less access to U.S. contracts than companies in Bahrain.

Mexico is also using this round to resist accepting changes to labour standards, the source said.

A big point of contention for Canada and the U.S. is the lack of strong labour standards in Mexico, which allows workers there to be paid a fraction of what they would earn elsewhere.

The Americans are seeking dramatic improvements on this front, in the hopes of reducing its trade deficit with Mexico.

Negotiators are also tackling rules of origin, with the source saying time has been set aside every day to discuss the topic.
The Ford Edge is made at the Ford Assembly Plant in Oakville, Ont. The U.S. demanding a higher North American content in autos in this round of NAFTA talks. (Canadian Press)

However, the most controversial aspect of this issue, American proposals to boost the overall North American content requirements from 62.5 per cent to 85 per cent in the auto sector, are not expected to come up this round.

The source says negotiators will be examining the frameworks that regulate other industries.

This round of talks will wrap up on Tuesday.