February 18, 2009 / 10:04 PM / in 9 years

NAFTA foes have hope for Obama renegotiation

WASHINGTON (Reuters) - Critics of the North American Free Trade Agreement say they do not expect President Barack Obama to return from a trip to Canada on Thursday with a blueprint to fulfill his promise to renegotiate the pact.

But they do hope for action later this year after Obama has consulted with key members of Congress on goals for reshaping the 15-year-old trade deal.

“You can’t campaign ... repeatedly about how you are going to fix NAFTA and otherwise reform U.S. trade and globalization policy and then not do it,” said Lori Wallach, director of Public Citizen’s Global Trade Watch. “Everyone’s going to be watching to see that he delivers on those promises.”

While NAFTA is on the agenda for the one-day visit with Canadian Prime Minister Stephen Harper and Canadian lawmakers, the short get-acquainted sessions will allow little time for detailed discussion, Wallach said.

Three-way trade between the United States, Mexico and Canada has tripled to nearly $1 trillion since NAFTA went into force in 1994, and together Canada and Mexico buy more than one-third of U.S. exports.

But the agreement is often blamed for U.S. job losses, especially in big Midwestern manufacturing states.

Obama and his chief Democratic rival during last year’s presidential campaign -- current U.S. Secretary of State Hillary Clinton -- rattled both Canada and Mexico with their sometimes intense criticism of NAFTA.

During a debate in Ohio in March, both said they would use the threat of withdrawing from the agreement if Mexico and Canada did not agree to modify the pact.


Obama is expected to consult extensively with Congress before embarking on any NAFTA renegotiation. Many Democratic lawmakers feel their concerns about trade were routinely ignored by Republican President George W. Bush and look forward to a better relationship with the new White House.

With former Dallas Mayor Ron Kirk still awaiting Senate approval to be Obama’s chief trade negotiator, that conversation has not really begun. However, business groups are hopeful Kirk could be confirmed by early March.

Although NAFTA does have labor and environmental provisions, those are contained in separate “side” agreements rather in the core text of the pact.

Obama repeated this week that he wants enforceable labor and environment provisions inside the actual pact.

That probably could be done without making any changes in U.S. law that would require congressional approval, a former Bush administration official said.

One possibility, consistent with recent U.S. trade agreements, would be to change the definition of labor laws in NAFTA to reflect the International Labor Organization’s 1998 declaration on core labor rights, which affirmed the rights of workers to bargain collectively and upheld other goals.

“Is that the kind of thing that would cause Canada and Mexico great consternation? It’s hard to imagine it would,” said Ted Posner, a partner at law firm Crowell and Moring who worked on trade at the Bush White House.

But Wallach said “fair trade” advocates that Obama courted during last year’s election expect much wider talks covering areas ranging from corporate investment and government procurement to food safety and agriculture.

“That does not require a cutting open of the whole agreement, but there are different pieces of it that need to be modified,” Wallach said.

Reporting by Doug Palmer; editing by Eric Beech

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