TORONTO (Reuters) - Toronto Dominion Bank (TD.TO) Chief Executive Bharat Masrani said on Thursday the bank’s commercial clients were nervous about the outcome of talks to update the North American Free Trade Agreement (NAFTA).
Officials from the United States, Canada and Mexico are continuing negotiations over a modernization of the $1.2 trillion trade agreement which was implemented 25 years ago, but wide differences remain on topics such as dispute resolution and how much North American content should be contained in autos produced in the three NAFTA nations.
Masrani said clients at TD, Canada’s second-biggest lender which also has substantial operations in the United States, held concerns over the drawn-out nature of the talks, which have been ongoing for seven months already.
“There certainly is nervousness,” he told reporters after the bank’s annual meeting. “Folks are worried, it’s critical that this gets sorted and that we move on.”
In an earlier speech to shareholders, Masrani said that he recognized a need to modernize the trade agreement between Canada, the United States and Mexico, but not to eliminate it.
“Each country has undergone significant changes since the trade agreement was implemented,” Masrani said. “My hope is that the merits of this partnership prevail - so we can look for ways to make NAFTA even better for each country.”
Royal Bank of Canada (RY.TO), Canada’s biggest lender, said last month that concerns about the outcome of talks to renegotiate the North American Free Trade Agreement were impacting longer-term investment decisions by its commercial customers.
U.S. Trade Representative Robert Lighthizer on Wednesday expressed optimism that talks to modify the $1.2 trillion trade agreement could be wrapped up quickly, but a top Canadian official was more downbeat, saying much work remained.
Reporting by Matt Scuffham; editing by Chizu Nomiyama and Susan Thomas