US softens stand on rules of origin; Canadian proposal gains momentum, says insider

26 February, 2018

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At a discussion panel held in Windsor, Ontario last week, Flavio Volpe, president of Canada's Automotive Parts Manufacturers' Association, said the U.S. delegation has soften its proposal of raising the minimum content from North American origin for vehicles manufactured in the NAFTA region, CBC News reported.

"I was very worried for a while there in the late fall when the Americans presented a proposal that said 50% of everything made in North America has to come from the U.S.," said Volpe.

But in the rounds of discussions that came after that proposal by the U.S., Canada countered by offering concepts to get the country away from American protectionism.

“We spent the next month or so explaining to them that if we had accepted their proposal the biggest loser would be American assemblers in Canada and Mexico. Once they saw that, there was a real softening," Volpe said.

According to the official, the Canadian counter proposal to consider software and research and development investments as part of the content has gained momentum in all three countries.

The seventh round of the NAFTA negotiations began in Mexico City on Sunday, with hopes of finalizing more sections.

Negotiators from Canada, the United States and Mexico held a closed-door meeting at a hotel in the country’s capital. The first day of talks will see 27 different working groups hold discussions on agriculture, good regulatory practices and rules of origin, among others.

Mexico's Economy Minister and head negotiator Ildefonso Guajardo said this round is to conclude on March 5 and could see up to seven sections or chapters finalized.

MexicoNow