The approval of U.S. Trade Representation nominee Robert Lighthizer is needed before NAFTA renegotiations can start, according to Press Secretary Sean Spicer. This may narrow the window for negotiations. Reuters reports the Senate Finance Committee has delayed a vote on its approval of Mr. Lighthizer’s nomination until after the Easter Senate break.

Once approved Mr. Spicer has indicated the administration will be “ready to probably announce a better work plan on” starting the 90 day consultation period with Congress that is required under TPA rules before negotiations can start. That consultation period would potentially include the publication of the omnibus trade deficit assessment required by President Trump’s recent Executive Order, as outlined in Panjiva research of March 31.

Assuming Congressional ascent of the administration’s negotiating plan is required before the summer recess that starts on July 31, then Mr. Lighthizer will need to be “in place” by May 2. Failing that NAFTA negotiations might not be able to start until after Labor Day (September 4).

Should the negotiations not begin until later in the year, Mexico may be at something of a disadvantage from a statistical perspective. Panjiva analysis shows that the U.S. trade deficit (ie goods imports less exports) vs. Mexico excluding energy has steadily increased over the past two years, reaching $76.4 billion in the 12 months to February 28 vs. $42.8 billion three years earlier. The U.S. deficit with Mexico has also tended to reach its highest for the year in October and November, with the result that new highs for the deficit may appear just as negotiations get under way.

Chart shows U.S. trade deficit (based on goods imports and exports) with Mexico excluding the balance of energy imports and exports (based on HS 27 chapter products)   Source: Panjiva