Mexican minister vows results as NAFTA talks move to Canada

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Mexico's Economy Minister is vowing that the renegotiation of the North American free-trade agreement will start to show results when talks move to Ottawa at the end of this month, as the three countries work to knock off the easiest items on the agenda.

But Canada, the United States and Mexico remain at loggerheads on a series of issues – from dispute settlement to labour – and U.S. negotiators have yet to even table details on some of the Trump administration's toughest proposals.

At a joint event in the offices of the Mexican economy ministry on Tuesday at the end of the second round of talks, Economy Minister Ildefonso Guajardo said the three governments are working to find the areas of greatest agreement in hopes of putting them to rest in the next round.

"We have instructed our chief negotiators to commit to defining what we call the closest chapters, to begin to see the first results in the third round," said Mr. Guajardo, flanked by Canadian Foreign Minister Chrystia Freeland and U.S. Trade Representative Robert Lighthizer. "We will be in close contact with the ministers to continue pushing our teams to present the first results in Canada."

The three countries broadly agree on energy, which involves bringing Mexico's rapidly opened oil and gas market into the deal, modernizing the agreement to cover the digital economy and cutting red tape for exporters and importers.

The third round is scheduled for Sept. 23 to 27. Two sources said it will most likely be held at Ottawa's old city hall building at 111 Sussex Dr.

The 23-year-old pact is being renegotiated at the behest of U.S. President Donald Trump, who blames the deal for moving factory jobs out of his country. Mr. Trump, who has repeatedly threatened to pull out of the deal, wants talks done by the end of the year to fulfill a key campaign pledge. Mexico wants to avoid discussions running into its presidential election next year. By comparison, most trade agreements take three to five years to negotiate.

The three countries have tabled two dozen texts that are now being merged into a single master document from which negotiators will identify the areas of agreement and points of friction.

"This is Day 20 of an extremely accelerated and extremely comprehensive negotiation," Ms. Freeland said. "We are running fast for the end of the year."

Mr. Lighthizer said negotiators are working at "warp speed" to get a deal.

But for all the talk of progress on Tuesday, the countries are separated by vast gulfs on the most contentious files.

The United States has signalled it will demand an American-content requirement in autos manufactured in the NAFTA zone; demanded that Canada's protectionist system of supply management for milk, eggs and poultry be loosened; and pushed for the gutting of the Chapter 19 dispute-resolution system that Canada and Mexico insist on, sources with knowledge said of the closed-door talks.

The round ended without the United States providing specific numbers on the American-content requirement, detailing exactly how it wanted supply management loosened or proposing an exemption for "Buy American" laws from government contracting rules, the sources said.

Canada, for its part, is pushing for the United States to ban "right-to-work" laws blamed for impoverishing unions in some states and pushed for climate change to be included in the pact.

The talks unfolded in an atmosphere of escalating tension.

Mr. Trump repeatedly threatened to pull out of the deal in the days leading up to the talks. He also took renewed aim at Mexico, blaming the country for "tremendous drugs" pouring over the border. On Tuesday, his administration announced it would do away with Deferred Action for Childhood Arrivals, a program that allowed undocumented immigrants brought to the United States as children to live and work legally in the country.

Mexico condemned the move, which would largely affect Mexican nationals.