OTTAWA (Reuters) - The current state of talks to update the NAFTA trade pact is creating uncertainty among businesses and could hurt investments and growth, Rio Tinto Aluminium (RIO.L) chief executive Alf Barrios said on Wednesday.
Canada and Mexico say several U.S. proposals for modernizing the North American Free Trade Agreement are unacceptable, prompting increasing concern that Washington could walk away from the trilateral deal.
Rio Tinto exports 75 percent of the aluminum produced at its Canadian plants to the United States and supplies 30 percent of that market’s needs, Barrios told an evening conference organized by the Canadian-American Business Council.
“The negotiation process has created some uncertainty among business on both sides of the border and I think this puts at risk to a certain degree investments and growth,” he said when asked about the NAFTA talks.
U.S. President Donald Trump frequently describes the 1994 pact as a disaster and has threatened to walk away from the deal unless major changes are made.
Company data show Rio Tinto’s Canadian plants accounted for 53 percent of the 3.65 million tonnes of aluminum that the company produced last year.
Barrios said NAFTA had created a predictable business environment that made investment decisions easier and had also solidified ties between Canada and the United States.
“So we’re watching very, very carefully how things evolve ... We encourage the negotiating teams at the table to continue looking at ways to strengthen that relationship,” he said.
Speaking earlier in the day, Bank of Canada Governor Stephen Poloz said the lack of clarity over the NAFTA talks meant companies would put off investment decisions.
Reporting by David Ljunggren; Editing by Michael Perry