The country of Mexico will have a new leader come December, and analysts are already looking into how it will affect North American Free Trade Agreement talks.
Mexican President-elect Andres Manuel Lopez Obrador declared he will support the current wave of NAFTA talks and hopes to continue work with Canada and the United States on a new agreement, Automotive News reported on Monday. Thus far, NAFTA talks have stalled as each side pushes for different goals. The U.S. has previously asked for high North American and U.S. part content figures to avoid tariffs, but eased demands last April.
U.S. negotiators also proposed offering credits to help automakers meet thresholds if they invest in workforces, salaries and new research. Each country agrees that higher wages for Mexican auto workers would help level the playing field and keep Canadian and U.S. jobs from heading south of the border. Lopez Obrador has supported the idea.
But, the newly elected leader also ran on a platform of increasing domestic food and oil production, which could be points of contention with President Trump. The shifts would mean less of a dependence on U.S. agriculture and Gulf Coast oil production.
NAFTA talks have mostly stalled as the window to ratify a new agreement closes. The original goal was to hash out a modern NAFTA this summer to ratify the agreement in a Republican-controlled congress. Mid-term elections in the U.S. and Mexico’s new president may stall things further. President Trump has also expressed interest in bilateral trade agreements with both Canada and Mexico over a new NAFTA.