Dan Ujczo, an worldwide trade lawyer, told Politico that to reach an agreement, negotiators may have to concede to a "skinny NAFTA", one without addressing key issues including reducing the trade deficit, preventing job outsourcing and providing better market access to Canada for US dairy farmers.
The nation's top trade official issued a frank and dour statement on Thursday about the state of negotiations on the North American Free Trade Agreement (NAFTA).
According to the minister, who heads Mexico's negotiating team, since Mexico, Canada and the United States chose to modernize the 1994 trade deal, they have advanced on "a third" of approximately 30 chapters.
"Lighthizer said the United States will continue to engage in negotiations to secure a deal beneficial for USA workers, farmers, ranchers and businesses".
Among them: government procurement, US access to Canada's dairy market, the system for resolving trade disputes, and the USA proposal for a "sunset clause" that would automatically terminate NAFTA in five years absent a new endorsement from all three countries.
It rebuffed an effort from Prime Minister Justin Trudeau, Foreign Affairs Minister Chrystia Freeland, and several high-ranking staffers who were in the US on Thursday urging a quick deal. The current frontrunner in Mexico's July 1 presidential election, left-leaning Andrés Manuel López Obrador, has pledged to stamp his own imprint on the deal, promising to appoint a new trade negotiator to this end if elected.
"We don't feel a deal with a sunset clause is much of a deal at all", Trudeau said.
"We will keep negotiating, and in the moment that we have a good negotiation, we can close the deal. independent of which Congress (the current or new) that will vote on it", he said on Televisa. "We didn't get there last week, but we will keep trying to achieve it".
The reason Canada, Mexico and some in the USA want a deal wrapped up has to do with creating certainty - in terms of business confidence, and in order to settle the process before elections in Mexico and the US stall progress until next year.
In Mexico, officials on Thursday downplayed the importance of Ryan's deadline.
Mexico will send part of its NAFTA team to Washington on Monday, and another contingent is already there, Economy Minister Ildefonso Guajardo said Thursday.
Canada's Prime Minister Justin Trudeau seemed hopeful, saying Thursday that a deal was "on the table" with just a few more issues to be worked out. "If you agree to build a building on a particular parcel of land, but only hold the lease for five years, and after five years you actually lose the lease, you might not be interested in investing in the building that's going on that land". However, the Canadian government does not appear to be in a rush for a deal to be reached.
House Speaker Paul Ryan said Congress needs a deal by Thursday in order for it to be approved by the midterm elections.