April 26, 2017 9:00 AM, EDT
Mexico Sees NAFTA Trade Talks Starting in August
Ildefonso Guajardo. Photo by Rodrigo Garrido/Reuters

Mexico expects to start the renegotiation of the North American Free Trade Agreement, or NAFTA, with the United States and Canada in late August and talks should be completed within six months, the country's economy minister said April 26.

With groundwork for the talks having to pass through U.S. lawmakers first, and elections due in the United States and Mexico in 2018, the timetable was tight, Ildefonso Guajardo told Reuters during an interview in London.

"I think it [the start of talks] will be likely at the end of August," he said, adding, "It needs to be wrapped up by spring 2018 by the latest. If not, you cannot afford uncertainty over uncertainty."

U.S. President Donald Trump has vowed to pull out of the NAFTA trade agreement that underpins the bulk of Mexican exports if he cannot rework it in his homeland's favor.

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Guajardo said the signatories to the treaty would have to make clear publicly what areas of NAFTA were up for renegotiation, adding Mexico did not want to discuss higher tariffs or an even more draconian export quota system.

"We have to make an effort to send a very clear message to the markets what this negotiation is going to be about," Guajardo said during a trip to London.

He added that stable markets were important so they did "not put pressure on any side" during the negotiations.

Trade Tensions

Regional trade tensions ratcheted up a notch this week when the Trump administration on Monday, April 24, announced a 20% duty on Canadian softwood lumber in retaliation for what it sees as unfair restrictions on dairy exports.

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While this was not directly linked to NAFTA, it could be seen as setting the tone for wider trade talks, said Guajardo.

He also confirmed that Mexico was looking at the option of imposing retaliatory tariffs on the U.S. after the World Trade Organization ruled in his country's favor in a dispute over tuna.

"What you generally do, and what we have done in other cases, like transportation, is you start reviewing imports that would be most sensitive politically," he said.

Speaking on Mexico's trade talks with the European Union, Guajardo said he expected the bloc's negotiators to travel to the country in May with his government hoping to accelerate the process.

"We will try to give the political mandate to go faster and we aim at finishing these negotiations by the end of this year," he said.

Mexico wanted to "really push the level of ambition" to get greater access to EU services and agriculture markets, he added.