Experts Say Trade Deal With Mexico Unlikely | Texas Public Radio

Experts Say Trade Deal With Mexico Unlikely

Aug 27, 2018

Political experts and Texas economists agree that the chance for a trade deal with Mexico and the future of the North American Free Trade Agreement both seem dim, despite President Trump’s enthusiasm.  

 

 


Economist Ray Perryman said the preliminary deal is limited and only affects the nation's automobile industry. He says the deal might eventually drive up the price of cars made in the U.S.

“Because we would have to buy more expensive parts that would have to go into the automobile and as a result of that the cost is going to go up,” Perryman said.

The deal at this point does not include Canada, and Mexico’s President Enrique Pena Nieto said any formal agreement with the U.S. must include that third partner.

It’s a point that Sen. John Cornyn of Texas stressed as a “must-have” in his statement on the deal's announcement.

But there's another challenge that highlights the deal's triple-sided political complexity. Mark Jones, political science at Rice University, said Congress will have to work quickly to make the deal official before Pena Nieto's successor takes office.

“One difficulty the negotiators face is that the next Mexican president, Andres Manuel Lopez Obrador, takes office on Dec. 1, and they want to get this all signed and put away because once he takes office, he’s probably going to want to revise some of it,” Jones said.

Congress has to ratify any agreement, but its term ends in 90 days. Then, four days later in Mexico City, Lopez Obrador assumes office.

So, Jones said, the Trump administration has only a few days to convince Canada to agree to the deal and begin the ratification process before Mexico's political climate changes.

Ryan Poppe can be reached at rpoppe@tpr.org or on Twitter @RyanPoppe1