Trade Issues Expected To Dominate Obama's Trip To Mexico

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STEVE INSKEEP, HOST:

On a Wednesday it's MORNING EDITION from NPR News. I'm Steve Inskeep.

And I'm Renee Montagne. President Obama arrives in Mexico today to meet with Mexico's president and Canada's prime minister. It's been dubbed the meeting of the Three Amigos. The one day summit of North America's leaders will focus on trade and commerce, but also on the agenda: security, energy, border issues and immigration. NPR's Carrie Kahn is in Toluca near Mexico City, where the summit begins later today. Good morning.

CARRIE KAHN, BYLINE: Good morning, Renee.

RENEE MONTAGNE, HOST:

And Carrie, is there any single issue that's likely to dominate this summit?

KAHN: It's trade. That's the talk at this summit. It's been exactly 20 years since the North American Free Trade Agreement went into effect and business is booming across the three countries. Trade between Mexico and the U.S. alone is more than $1 billion a day. And officials in all three countries were asked in the run-up to the summit, you know, would NAFTA be reopened for negotiation?

And in Mexico here the undersecretary for North American Foreign Relations, he was quite frank with reporters. He said no. He said it's not in anyone's interest to reopen NAFTA. But in the ongoing negotiations for the Trans Pacific Partnership that all three countries are involved in, the TPP, they said that they could take up issues for an update.

And a senior White House official told reporters they believe the TPP negotiations would be a good way to introduce additional standards to deal with the labor and the environment. There will also be talk about streamlining, importing, and exporting, and President Obama actually is set to sign an executive order as he travels here to Mexico to really facilitate that process across the borders.

MONTAGNE: Well, to another very different issue. Mexico has been fighting a war with its drug cartels since 2006, and of course the cartel's main drug market is here in the U.S. Will the three leaders be talking about that much?

KAHN: A senior White House official did say there will be talk about U.S. ongoing cooperation and support of Mexico's fight against drug trafficking, but that was about it. But President Pena-Nieto's been in office here for 14 months and during that time he does not like to talk about the violence here, especially drug trafficking. He's downplayed it quite a lot.

He prefers to focus on the economy and his ambitious reform agenda. But the summit is being held just 60 miles from the state of Michoacan, where President Pena-Nieto last month sent in thousands of federal troops. He wanted to head off a violent confrontation between a powerful drug cartel and this growing number of armed civilian militias that have popped up around the country - not only in Michoacan. There's vigilante groups now active in at least five states.

And so the situation in Michoacan has been an embarrassment for Pena-Nieto. He was at Davo, Switzerland last month at the World Economic Forum and that was one of the first questions he was asked, about violence in Michoacan, not about Mexico's economy, so he's really not anxious for a repeat of that here with President Obama or Prime Minister Harper.

MONTAGNE: Well, as you said, Enrique Pena-Nieto has been in office just over a year, but his popularity is already dropping and a lot of protestors are expected at this summit. So what's the security like?

KAHN: It's pretty tight. Streets are blocked off around where the summit is being held. And there's - protestors say they'll be out and they have a lot of different issues. There's teachers upset about Pena-Nieto's education reform, there's leftist activists upset about an administration's opening up of Mexico's oil industry, and there's people upset about the economy.

Now, on a macro level, Mexico looks good. It has low inflation, just got its bond rating raised to an A, but consumer confidence dropped dramatically last month and President Pena-Nieto's new reforms raised taxes on everything from soda to dog food. So people are feeling it in their wallets and his approval ratings are dropping and they're upset.

MONTAGNE: Carrie, thanks very much.

KAHN: Thank you, Renee.

MONTAGNE: That's NPR's Carrie Kahn talking to us from Toluca near Mexico City, where the heads of Mexico, Canada, and the U.S. are meeting. Transcript provided by NPR, Copyright NPR.