Canada and Mexico may be open to tweaking USMCA: U.S. Democrat

WASHINGTON (Reuters) - Canada and Mexico may be open to a limited renegotiation of aspects of the United States-Mexico-Canada free trade agreement to satisfy U.S. lawmakers’ concerns, a top U.S. Democrat said on Wednesday, opening the door to its passage in the fall.

FILE PHOTO: Flags of the U.S., Canada and Mexico fly next to each other in Detroit, Michigan, U.S. August 29, 2018. REUTERS/Rebecca Cook/File Photo

“There are alternatives, including strategically opening [the agreement] on specific items,” said Earl Blumenauer, the Oregon Democrat who chairs the trade subcommittee of the House of Representatives Ways & Means Committee.

He said that the trade agreement could be modified to address specific concerns, but was skeptical about using so-called side agreements, which he said had proven problematic in the current trade agreement among the three nations.

Mexico this month became the first of the countries to ratify the trade deal and Canada is pressing ahead to follow suit. U.S. Democrats have threatened to block the process until their concerns over labor and environmental provisions are met.

Blumenauer said that he was “troubled by the drive-by tariff strategy of this administration,” but was encouraged after a meeting with U.S. Trade Representative Robert Lighthizer and eight other House Democrats on Tuesday.

Blumenauer told an event hosted by the Washington International Trade Association any follow-up deal to the North American Free Trade Agreement would have to include better protections for workers, tough enforcement and other improvements to win Democratic support.

He said there would be “no way” that would be possible before the August recess but that Congress would continue to work on it in autumn.

Next month, Blumenauer will lead a congressional delegation to Mexico to discuss the USMCA, the office of the Ways & Means Committee said.

Democratic lawmakers and labor leaders rallied outside the U.S. Capitol on Tuesday to demand these changes, delivering petitions signed by nearly 400,000 people.

“The new NAFTA is not good enough yet,” AFL-CIO president Richard Trumka told the rally and vowed not to support it “until it’s worthy of the American people.”

Reporting by Jonas Ekblom; editing by Marguerita Choy and Susan Thomas