FILE PHOTO: Mexico's Economy Minister Ildefonso Guajardo at a news conference in Mexico City

By Timothy Aeppel and Sharay Angulo

Mexico's economy minister said on Thursday he was pushing for a quick deal with U.S. officials in the renegotiation of the North American Free Trade Agreement (NAFTA), with a breakthrough on new rules for the auto industry still elusive.

Since restarting last month, the talks have focused on settling differences between Mexico and the United States at the center of U.S. President Donald Trump's complaint that NAFTA has undercut U.S. manufacturing to Mexico's benefit.

Trump has threatened to withdraw from the 24-year-old trade pact between the United States, Mexico and Canada if it is not reworked to the advantage of the United States. He hopes to reduce the U.S. trade deficit with lower-cost Mexico and claw back jobs, particularly in the auto industry.

"The idea is to do our best to finish this agreement as soon as possible," Mexican Economy Minister Ildefonso Guajardo told reporters as he entered the latest NAFTA talks at the offices of U.S. Trade Representative Robert Lighthizer in Washington.

"It's better to have a good agreement than a fast (agreement)," the minister added.

Mexico and the United States have said they are close to resolving remaining bilateral issues in the revamp of the trade pact. However, a day earlier Guajardo had said the two sides might be able to reach agreement in "hours."

The tone has become more cautious since then.

Canada has been waiting for the Mexican and U.S. teams to reach common ground before rejoining the negotiations.

Much of the negotiation has focused on revising rules of origin for autos to try to bring more production to the region.

U.S. and Mexican officials say they will push for a deal that could open the door for Canada to return.

However, Canada's government reiterated on Thursday that it would need to be satisfied with any new rules of origin.

"Updating the 'rules of origin' has always been a very big, important and complicated effort," Canadian Foreign Minister Chrystia Freeland told reporters in British Colombia. "Canada clearly has an interest in how those rules are updated and we clearly will need to look and agree to any final conclusion."

The Trump administration wants to be able to impose national security tariffs on future Mexican production from new auto assembly and parts plants, according to auto industry officials. That has caused friction at the talks.

The threat of 25 percent tariffs could discourage new automotive investment in Mexico to serve the U.S. market.

Asked whether tariff-related issues in the automotive sector were holding up progress at the talks, Guajardo said he was "not going to comment on every single item."

Guajardo has said he hoped that a deal in principle would be possible in August. Asked whether that was still the plan, Guajardo said that it was a "very efficient timeline."

(Reporting by Sharay Angulo and Timothy Aeppel; Editing by Marguerita Choy)


Source: Reuters