U.S. Trade Representative Robert Lighthizer warned that the United States is prepared to break up NAFTA into separate agreements with Canada and Mexico if it can't make headway on its priorities in the renegotiation.
"We would prefer a three-way, tripartite agreement. If that proves impossible, we are prepared to move on a bilateral basis if agreement can be made," Lighthizer said at the close of the seventh round of talks Monday in Mexico City.
"We have tried to be clear and very specific about what we hope to see in a new NAFTA," he added. "We are prepared to work continuously to achieve a breakthrough."
Lighthizer complained of the slow progress in the talks, as he did at the conclusion of the previous round.
"To complete NAFTA 2.0, we'll need agreement on roughly 30 chapters. So far, after seven months, we have completed just six," he said. "Granted, these things tend to converge more towards the end of a negotiation."
Still, Lighthizer struck a somewhat optimistic tone near the end of his remarks.
"I understand that these talks are not easy for anyone" he said. "If the political will is there, I'm certain that we have a path to rapid and successful conclusion."
Lighthizer also warned of impending elections in Mexico, Canada and the United States. Mexico's presidential election will take place in July. Provincial elections in Ontario and Quebec also will be held later this year, as will the midterm elections in the U.S.
"All of this complicates our work," Lighthizer said. "I fear that the longer we proceed, the more political headwinds we will feel."
The U.S. trade chief said domestic laws requiring consultations and reports to lawmakers make it more important to resolve outstanding issues soon if the deal is to be considered by the current Congress.