Commerce's Ross Says Best Chance for Nafta Revamp Is by January

(Bloomberg) -- U.S. Commerce Secretary Wilbur Ross said the strongest chance for completing an overhaul of the North American Free Trade Agreement is through early next year before Mexican presidential elections.

“My guess is that we probably have the best window from now until December or early January,” Ross said during an event in Washington on Wednesday. Mexico's “election is mid-year, so the closer you get to it the more complicated it will become, particularly in terms of getting the Mexican congressional approval.”

There's also an incentive for the U.S. to get a deal done quickly, said Ross, citing the expiration in July 2018 of presidential powers to negotiate trade deals that can either be approved or rejected by Congress without amendments. Before it lapses, the White House would have to ask Congress to renew the so-called Trade Promotion Authority.

Beyond that, the U.S. also holds midterm elections in November next year, “and those will undoubtedly have some impact on congressional views,” said Ross.

Ross's sentiment echoes Mexican Economy Minister Ildefonso Guajardo, who has urged for speedy talks and the conclusion of a final deal by the end of this year.

The U.S. could find itself in a weakened negotiating position depending on the outcome of Mexican presidential elections in July 2018. One of the leading contenders, Andres Manuel Lopez Obrador, has suggested he'll take a more confrontational approach with U.S. President Donald Trump, who has vowed to bring home jobs from Mexico and build a southern border wall to keep out undocumented immigrants.

Canada, the third Nafta partner, next holds federal elections in October 2019.

Official talks with Canada and Mexico can begin as early as Aug. 16, after a 90-day period of domestic consultations in the U.S. ends.

--With assistance from Nacha Cattan

To contact the reporter on this story: Andrew Mayeda in Washington at amayeda@bloomberg.net.

To contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, Sarah McGregor, Randall Woods