Mexico says Trump's unsurprising Nafta threats a negotiating tactic

US President Donald Trump's threat to scrap the Nafta trade pact is little more than a negotiating tactic, aimed at his political base, that should neither scare nor surprise Mexico, the country's foreign minister said on Wednesday as the peso weakened.

In a speech in Phoenix on Tuesday night, Trump reiterated his threats to terminate the North American Free Trade Agreement, saying the pact's future looked bleak. Trump has long called the 1994 pact a bad deal that hurt American workers, saying it should be re-negotiated or ended.

Initial talks to re-negotiate Nafta between Mexico, the United States and Canada ended in Washington this weekend with no sign of a breakthrough and further discussions are due in Mexico City in September.

Following Trump's remarks on Tuesday, Mexico's peso weakened more than 1 per cent in early trading on Wednesday before paring losses, as market jitters on the future of Mexican exports to the United States continue to plague the currency.

Videgaray, speaking on local television, sought to brush off the threat, saying Trump's comments were simply a negotiating tactic and Mexico would keep negotiating as well. The comments were not a surprise, nor would they scare Mexico, he added.
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Protectionist measures increase risk of trade war, warns WTO chief

There is a "clear" risk of a trade war happening because of protectionist policies, the World Trade Organisation chief Roberto Azevedo has said.

The WTO's director-general did not implicate any countries by name behind such policies, even though he was asked about the effects US President Donald Trump's "America First" stance could have on the global trading system.

"The risk of a trade war is very clear," Azevedo told reporters yesterday during a visit in Panama.

"Once a country, whichever one, applies unilateral measures, there is a response from others and we could see a domino effect," he said.

"The reality is that, at the end of the process, if we have a trade war everybody without exception will be worse off than when it starts."

Since entering the White House, Trump's administration has talked about the US trade deficit vis-a-vis several countries, notably China and Mexico.
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Post-Brexit trade deal: No talks before UK settles what it owes, says EU

European Union governments agreed a common Brexit negotiating plan on Monday and renewed their insistence that they would not open talks on a post-Brexit trade deal until London agrees to settle what it owes the Union.

Ministers from the 27 other EU states met in Brussels to sign off on a common strategy and mandate the EU executive, in the form of chief Brexit negotiator Michel Barnier, to launch talks on their behalf after Britain's June 8 election. The strategy and mandate were adopted unanimously, officials said.

Barnier said he expected to sit down with British officials for the first time in the week starting Monday, June 19, and to report to EU leaders on the talks during a summit on June 22-23, exactly a year since Britons shocked the Union by voting to leave in a referendum on June 23, 2016.

Several ministers stressed their priorities are to provide legal clarity for EU citizens in Britain before they find themselves living outside the EU in March 2019 and to agree how to calculate what London owes Brussels before departure.

The Union's leaders agreed last month on a phased structure of talks, under which the free trade agreement which British Prime Minister Theresa May wants with the EU would only be discussed after a first phase of talks makes "significant progress" on issues such as citizens' rights and the budget.

"It's clear that in this matter, on the finance issue, if we get stuck then we will not get onto 'phase two', what should come afterwards between the European Union and Great Britain," Luxembourg Foreign Minister Jean Asselborn said on arrival.

His Dutch counterpart Bert Koenders told reporters: "It's very British to know that if you're part of a club and then you leave you have to settle your accounts."

Deal or No Deal

Barnier's British counterpart, Brexit Secretary David Davis, told a weekend newspaper that his threat to walk out without a deal with the EU was serious. Barnier said that was "not my option" and he did not want to think about such an outcome, which EU officials say would create a chaotic legal limbo.
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