NAFTA now stands at a crossroads. The decisions made by the current administrations of all three countries will shape the future for North American business. Robert A. Pastor, a professor of international relations at Emory University, is working on a book on the future of NAFTA and has held informal discussions about these issues with key figures in all three countries, including Mexican foreign minister Jorge G. Castañeda, who was co-author of a 1997 book with Pastor on U.S.-Mexico relations, titled Limits to Friendship. Slated to be published this fall by the Institute for International Economics in Washington, D.C. the book is titled, Toward a North American Community: Lessons from the Old World for the New. Knowledge@Emory asked Pastor to discuss the current issues facing NAFTA and his recommendations for the future.

Knowledge@Emory: In the past several weeks, the Bush Administration has made several well-publicized moves to further its free trade policy. These include meeting with Mexican President Vicente Fox an unprecedented three times in four months and urging Congress to grant President George Bush fast-track authority to negotiate agreements that Congress can approve or reject, but not amend. How would you describe the administration’s activity?

Pastor: There are two distinct issues: The administration’s approach to NAFTA and to trade. Regarding NAFTA, the Bush Administration has demonstrated great interest in strengthening relations with Mexico and Canada and exploring new areas for collaboration. The question is whether the Administration chooses to approach its neighbors one issue or one commodity – softwood lumber or sugar – at a time, or whether it decides on a more comprehensive and novel approach, as Mexican President Vicente Fox has proposed.

Regarding trade policy, the administration is pressing to gain Congressional approval for the Trade Promotion Authority (TPA), which would allow it to negotiate trade agreements all over the world, including the Free Trade Area of the Americas (FTAA). They are also seeking approval of trade agreements that have been recently signed with Jordan, Vietnam and Laos.

Knowledge @Emory: How did you hear about the Fox proposal and what can you tell us about it?

Pastor: I have had discussions before, during, and after the Mexican election with Mexican president Fox and more extensive conversations with foreign minister Castañeda. Fox proposed that NAFTA be transformed into a common market among the three countries that would involve harmonization of policies and the eventual free movement of labor. He recognizes that the U.S. would not accept the free movement of Mexican labor into the U.S. for the foreseeable future.

As yet, there have been few responses by the Bush administration in reviewing the existing agreement or creating new institutions to expand NAFTA’s role beyond trade issues. The book I’m writing outlines a number of proposals, including one for the establishment of a North American Commission (NAC), which would be an independent, lean advisory body with a mandate to develop a North American integration and development plan.

President Bush, Mexican President Fox and Canadian Prime Minister Jean Chretien would each appoint five individuals from outside the government to lead the NAC. The NAC would make suggestions on many issues. For example, the NAC could propose a North American Plan for transportation and infrastructure, ranging from highways to fiber optic cables or natural gas pipelines. It could outline the steps necessary to establish a Customs Union. It could also advise on social and cultural issues such as immigration and drug smuggling.

Knowledge@Emory: There have been reports that the usually trouble-free relations between Canada and the U.S. are deteriorating over such issues as lumber exports. How will that impact NAFTA?

Pastor: The Prime Minister was recently in Atlanta, Ga., and he talked about how positive the relationship is. Trade between our two countries is larger than between any two counties in the world, and some disputes are inevitable. When I was in Quebec City during the Summit of the Americas, I met with John Manley, Canada’s foreign minister, and we discussed these issues. The Canadians prefer to deal with the U.S. on a bilateral basis, and that’s been satisfactory to the U.S.

But I suggest that a trilateral approach like NAC makes more sense in the long term, because it permits the establishment of rule-based mechanisms. The alternative is to let problems fester or be resolved by raw power or emotions or special interests. It would be better to have a more neutral and fair formula to resolve disputes.