The first round of negotiations between the United States, Mexico, and Canada over the North American Free Trade Agreement (NAFTA) took place August 16-20 in Washington, D.C. The talks were the first of several scheduled rounds between now and the end of the year, when the three nations hope to conclude a deal.

At the outset, U.S. Trade Representative Robert Lighthizer delivered a list of demands on behalf of the White House, including an overhaul that would cut U.S. trade deficits and increase the use of regional parts for autos produced in North America. Lighthizer went on to say that the Trump administration believes that NAFTA has "fundamentally failed" Americans and is in need of "major improvements." Representatives from Canada and Mexico said the current agreement is not tilted against the United States.

President Trump recently wrote on Twitter that he is considering terminating NAFTA because he claimed Mexico and Canada are "being very difficult" in the negotiations. He wants the United States to "get a better deal."

Pacific Council Directors Mickey Kantor, former U.S. Commerce Secretary, and Michael Camuñez, former U.S. Assistant Secretary of Commerce for Market Access and Compliance, agreed that NAFTA needs to be updated, but urged the president in media interviews not to pull the United States out of the agreement entirely.

"It is critical for us to begin to make changes in NAFTA, but we need to make sure we don’t throw out the baby with the bath water."

Mickey Kantor

"It is critical for us to begin to make changes in NAFTA, but we need to make sure we don’t throw out the baby with the bath water," Kantor told Bloomberg. "Bob Lighthizer has a president who has engaged in unfortunate rhetoric and he’s trying to be somewhat consistent with that. But I don’t think you should take what is said publicly as compatible with what might be said privately.

"At the beginning of negotiations, you’re trying to position yourself," Kantor continued. "[Privately], you’ve got to build respect and trust with people across the table... What people may not understand about trade negotiations is that even though there may be three sovereign nations involved who have a whole history of reliance on each other, it comes down to people."

According to Forbes, the United States had a $64 billion trade deficit with Mexico in 2016. In the first half of 2017, that deficit was $37 billion, compared to $1.6 billion in 1993, NAFTA's first year, according to U.S. Census Bureau data. The U.S. trade deficit with Canada is about $10 billion, a low point following 2005's $78 billion.

Camuñez said an upgraded NAFTA will ultimately be beneficial to both the United States and Mexico, where his firm Monarch Global Strategies works with U.S. companies looking to expand.

"Companies recognize NAFTA needs a facelift," Camuñez told Forbes. "At the core, they understand that NAFTA is essential to the competitiveness of all three countries."

"Had the Trump administration already racked up a few legislative accomplishments, they might be feeling much more bullish and aggressive in their willingness to take a firm stance on some of the political bluster and rhetoric they’ve been pushing with Mexico."

Michael C. Camuñez

Camuñez pointed out that both the U.S. and Mexican governments likely want to conclude the negotiations before the U.S. congressional midterm elections and the Mexican presidential election in fall 2018. Therefore, the end result of the talks will likely only cover the simpler issues, which Camuñez said the Trump administration may want to portray as a "major modernization" of the agreement as promised.

"Had Trump scored a victory in the repeal of Obamacare, had he already racked up a few legislative accomplishments, the administration might be feeling much more bullish and aggressive in their willingness to take a firm stance on some of the political bluster and rhetoric they’ve been pushing with Mexico," said Camuñez. "But the reality is that the administration has floundered and has virtually no legislative accomplishments to speak of, and that actually works in favor of a more reasonable outcome for the NAFTA renegotiations."

Kantor said he thinks the negotiations will be successful if the new NAFTA creates jobs, wealth, production, and higher incomes in all three countries, like the original NAFTA did.

"U.S. exports to Mexico have grown 400 percent since NAFTA started," he said. "They are almost as large as all of U.S. exports to all of the European Union countries combined. The fact is that Mexico is a major market for the United States, as is Canada. The three together are the largest trading market in the world."

Kantor added that it is critical that NAFTA is updated and not terminated entirely.

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Justin Chapman is the Communications Associate at the Pacific Council on International Policy.

The Pacific Council's Mexico Initiative will continue to monitor the ongoing NAFTA negotiations. Under the auspices of the Mexico Initiative, chaired by Michael C. Camuñez, the Pacific Council holds events, produces analysis and commentary, and fosters exchange with Mexican leaders. Learn more.

Legend has it that in 1964 San Francisco, a martial arts fight took place between a scruffy young Bruce Lee and kung fu master Wong Jack Man. The fight became an important part of martial arts history and inspired George Nolfi’s latest film, Birth of the Dragon, released this week in the United States.

Nolfi, a Pacific Council member, directed the homage to a classic kung fu film, which is set during the mid-20th century when Bruce Lee started to practice Wing Chun, a Chinese martial arts form and school of thought, in the United States. Lee became a Hollywood celebrity after starring in American kung fu movies in the 1970s. According to Nolfi, Lee believed Chinese martial arts should be a global practice instead of confined to China, as some more traditional Chinese martial artists maintained.

Birth of the Dragon was filmed in China, San Francisco, and Vancouver, and the experience allowed for a deep cultural exchange between the filmmakers and Chinese leaders of kung fu, who expressed enthusiasm and openness to sharing martial arts with new audiences. Kylin Pictures International, a Chinese film financier, financed Birth of the Dragon as well as other recent American films, including Mel Gibson’s Hacksaw Ridge.

Entertainment, media, and creative services—with the potential to reach and influence billions of people worldwide—could serve as an important tool in recasting Chinese and Americans' perceptions of one another.

Nolfi’s film is a product of the burgeoning relationship between Hollywood and China, demonstrated by increased Chinese investments in American studios and films. Last year, Steven Spielberg’s entertainment company, Amblin Partners, signed an agreement with Jack Ma’s e-commerce conglomerate, Alibaba Group, to co-produce and co-finance movies. Furthermore, in 2016 the Chinese firm Dalian Wanda Group (DWG) purchased Legendary Entertainment, which produced The Dark Knight, Jurassic World, and several other blockbusters, for $3.5 billion. DWG has also purchased AMC.

Entertainment, media, and creative services—with the potential to reach and influence billions of people worldwide—could serve as an important tool in recasting Chinese and Americans' perceptions of one another. As Pacific Council President and CEO Dr. Jerrold D. Green wrote in a June 2016 report, "There is a natural opportunity here to use entertainment as a medium for public diplomacy messaging. The more we learn about China and the more they learn about us, the more likely and able both sides will be to update narratives of one another and to begin a more meaningful and far deeper level of engagement."

There is big money for Hollywood studios to make in China. Hollywood accounted for 42 percent of China’s box office in 2016. That year, China’s homegrown film industry released 1,000 movies, but they only made about $2 million each in China compared with the $70 million on average that Western movies made in China. The Los Angeles Times reported that almost every Chinese film company is facing financial difficulties.

While in recent years Chinese investment in Hollywood has grown, the trend has slowed down in 2017. This is due in large part to the Chinese government’s prohibition on the exchange and export of currency and therefore investment in foreign firms, which Hollywood benefited from significantly.

And from a creative perspective, financial involvement by Chinese companies is having adverse effects on the films. With its investment, China also wants creative control in the form of censoring messages it does not want to reach Chinese audiences.

One example is The Great Wall, which was funded largely by Chinese-owned firms Legendary Entertainment and China Film Group along with Universal Pictures. The film’s narrative portrays China in a positive light, with Matt Damon defending the Chinese state against invaders. The movie tanked in North America and China, earning just $34.8 million in North America and $171 million in China, much less than investors, who lost $75 million on the film, anticipated. China responded to negative reviews of the film by censoring them.

With its investment, China also wants creative control in the form of censoring messages it does not want to reach Chinese audiences.

Another controversy in the Hollywood/China relationship is "whitewashing," when white actors are cast to play traditionally non-white roles. There is a long history of white actors playing Asian characters in Hollywood films that continues today. Casting decisions such as Damon in The Great Wall and Scarlett Johannsson in Ghost in the Shell were met with widespread criticism. Adding to the controversy, a 2015 USC report found that white actors make up an average of 75.2 percent of speaking roles in top-grossing fictional films. For their part, Hollywood studios say Chinese audiences want to see American celebrities.

Nolfi notes that Birth of the Dragon was written by westerners but produced with Chinese executives, and 22 of the film’s 23 speaking roles belong to Asian or Asian-North American actors. The movie is a Hollywood take on an event that is strictly Chinese in culture, but chronicles a moment of historical cross-cultural exchange that anyone who has practiced martial arts or seen a Bruce Lee film can appreciate.

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Marissa Moran is the Senior Communications Officer at the Pacific Council on International Policy.

Justin Chapman is the Communications Associate at the Pacific Council on International Policy.

Climate change and regional conflicts make South Asia one of the most water insecure regions in the world, Dr. Zafar Adeel and Dr. Isha Ray told Pacific Council members in the third installment of the Pacific Council’s Summer Teleconference Series, on solving South Asia’s water crisis.

Adeel is the executive director of the Pacific Water Research Centre at Simon Fraser University. Ray is the co-director of the Berkeley Water Center at the University of California, Berkeley. The discussion was moderated by Ms. Courtney Weatherby, research analyst at the Stimson Center.

Transboundary rivers such as the Ganges, Indus, and Mekong have defined the geography, history, and culture of South and Southeast Asia for centuries and are critical to economic growth, food and energy security, and sustainable development within the region. But over the last few decades, these rivers have come under considerable pressure from industrial development, urbanization, population growth, and environmental pollution. Furthermore, poor domestic management of water resources and increasing variability in rainfall and climate patterns have made South and Southeast Asia highly susceptible to floods, droughts, and natural disasters. Water insecurity is already a daily reality for many South and Southeast Asians.

"Water security and water scarcity are completely different things," said Ray. "South Asia is water insecure in many ways, but it is not because of some actual, physical scarcity, per se. There are, of course, arid regions within some South Asian countries, but overall the region is not physically short of water resources. Therefore, we have to look at water security and insecurity in South Asia primarily as a resource management and governance problem."

"South Asia is water insecure in many ways, but it is not because of some actual, physical scarcity, per se. Therefore, we have to look at water security and insecurity in South Asia primarily as a resource management and governance problem."

Isha Ray

Adeel added that South Asia is "one of the most water insecure regions of the world, in terms of both water availability and the impact it has on the health and well-being of its people."

Enormous inequality in South Asia drives the lack of access to water, said Ray, as well as sanitation injustice in the region. That inequality is a result of asymmetric power both among the countries in the region as well as within each of those countries.

"India is the dominant country in the region," said Ray. "These water issues can spill over across boundaries into transboundary conflicts and relationships. The large bulk of power that India demands makes these relationships unequal and complicates the transboundary politics enormously."

Adeel said that climate change and regional conflicts are also major concerns and factors when it comes to water insecurity.

"There are changes to the water regime taking place in the region due to climate change," said Adeel. "We have seen extreme weather events, and the forecast at the moment is that we will see a faster melting of glaciers over the next 15 to 20 years. Sea level rise is also a major concern. If we have a sea level rise of half a meter, about two feet or so, we will see about a third of Bangladesh go underwater."

"If we have a sea level rise of half a meter, about two feet or so, we will see about a third of Bangladesh go underwater."

Zafar Adeel

Conflicts in and between countries such as Afghanistan, Pakistan, India, Sri Lanka, and Nepal have also made the region one of the most violent places in the world.

"Nations should think about water as one more resource to negotiate over amid multiple non-water issues such as land, conflict, and trade," said Ray. "The boundaries of their negotiations should be broadened a little more to resources and policies that go beyond water in order to not constantly see the sharing of water as a zero sum game."

Weatherby pointed out that the Mekong river is a controversial water source and a serious challenge because of tension between China and Vietnam and because many countries rely on it.

"There’s a necessity for downstream countries to broaden the scope of their negotiations with, for example, China, and not just saying, ‘Don’t build a hydropower plant, don’t build this irrigation project,’" said Weatherby. "Because without offering something in return and having a broader discussion about the context in which water plays a role in development, it can be very difficult to come to any productive conclusions."

Adeel said the international community has an important role to play in the region’s water crisis.

"The international community should serve as an honest broker that provides essentially diplomatic support for going in the direction of more regional collaboration and perhaps even de-escalating some of the conflicting positions," he said. "They should also be putting in financial investments to improve governance and management practices."

"How can we expect women to reach their full potential when the burden falls on them to make sure water is available?"

Isha Ray

Ray pointed out that there is also a significant gender aspect to this crisis.

"Throughout South Asia, it is often the woman’s role to ensure food and water security for the family," she said. "As water access becomes more difficult because of climate change and other reasons, the burden has been on women to walk greater distances to get water, or treat the quality of water, or make do with very little water for additional domestic chores such as laundry, cooking, and cleaning, for which she is also traditionally responsible."

She added that access to safe and secure water sources affects women’s and girls’ lives much more than it tends to affects men’s and boys’ lives because of cultural and social expectations of gender roles.

"How can we expect women to reach their full potential when the burden falls on them to make sure water is available?"

Listen to the full conversation below:

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Justin Chapman is the Communications Associate at the Pacific Council on International Policy.

The Pacific Council’s Summer Teleconference Series continues with discussions about the U.S.-Russia relationship on August 24; and Germany’s upcoming election on September 21. Read summaries of the previous discussions in the series here.

This teleconference topic was part of the Pacific Council's Global Water Scarcity Project which connects the dots between California's water scarcity challenges and international issues of trade, energy, politics, and security. 

The views and opinions expressed here are those of the speakers and do not necessarily reflect the official policy or position of the Pacific Council.

Saudi Arabia has committed war crimes in Yemen’s civil war, creating a humanitarian disaster that demands resolution, Ambassador Barbara K. Bodine and Mr. James P. Farwell told Pacific Council members in the second installment of the Pacific Council’s Summer Teleconference Series.

Bodine is the director and distinguished professor in the practice of diplomacy at Georgetown University’s Institute for the Study of Diplomacy. Farwell is an associate fellow in the department of war studies at King's College London and a senior fellow at the Middle East Institute. The discussion was moderated by Ms. Suzie Abdou, a consultant at Ma’at Consulting.

Yemen’s undeclared civil war could have far-reaching, unpredictable, and international consequences. The conflict, spreading outwards from the key southern battleground around Aden, pits Saudi Arabia, the leading Sunni power—plus what remains of Yemen’s government—against northern-based Houthi rebels, who are covertly backed by Shia Iran. What has until now been an unacknowledged proxy war between Iran and Saudi Arabia has burst into an open confrontation that appears to be escalating rapidly. 

"The Saudi intervention in the conflict qualitatively changed the extent and consequences of the war," said Bodine. "The infrastructure has been destroyed and half the population is displaced."

"The Yemen conflict is a debacle and a stalemate that is not going to get better for Yemen, Saudi Arabia, or the United States."

James Farwell

Both Bodine and Farwell said that Saudi Arabia is potentially guilty of war crimes in Yemen and that the U.S. government is complicit because of its support of Saudi Arabia’s campaign.

"The United States provides the weapons, precision missiles—which are only precision if they’re fired correctly—and fuel for Saudi jets," said Bodine. "We are complicit, and we will pay with our credibility in the region."

Farwell said the United States cannot and should not "be in the position of supporting actions that most people around the world would consider war crimes. This is a debacle and a stalemate that is not going to get better for Yemen, Saudi Arabia, or the United States. The Saudis cannot win this war."

Bodine agreed that the war in Yemen is a stalemate politically and militarily and called for an end to the Saudi air bombing campaign in Yemen, including U.S. support for that campaign, which she said has created a humanitarian disaster.

"It is estimated that one person in Yemen dies of cholera every single hour," she said. "It is a humanitarian disaster." Farwell agreed, adding that out of 27.6 million Yemenis, over 17 million do not know where their next meal will come from.

The question, Farwell said, is whether or not the United States has the moral courage to stand up and stop the Yemen conflict. Bodine said that is doubtful, given that "the Trump administration’s embrace of the Saudis has emboldened them and their policies in places like Yemen."

"There is a very strong sense of national Yemeni identity. That is much of what will bring about a political solution to the war."

Barbara Bodine

So how does this conflict get resolved? Bodine said it will have to be a UN-brokered agreement and a massive reconstruction effort that will cost billions of dollars. She also said that Yemenis themselves will have to play a large role in the resolution of this conflict.

"There is a very strong sense of national Yemeni identity," said Bodine. "That is much of what will bring about a political solution to the war."

Farwell added that one hopeful aspect of the situation is that "there is more of an attitude towards reconciliation in Yemen than in most places in the Middle East."

Bodine said that so far, the Yemen war has been largely unknown and unreported and is only now starting to get attention in the United States. Farwell added that it is a common misperception that the conflict is actually a proxy war between Iran and Saudi Arabia.

"Framing it that way is warped," he said. "The Houthis in Yemen would be highly insulted by the notion that they are proxies for Iran. We have to get over this paranoia about Iran. Being hostile to Iran is not always the best strategy, especially in Yemen."

Bodine agreed, saying the Yemen war "is not a Shia-Sunni conflict. It is a civil war exacerbated by the overlay of a proxy war, driven by grievances."

Ultimately, if the conflict continues to worsen in Yemen, Farwell said, the party that stands to benefit is al Qaeda.

Listen to the full conversation below:

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Justin Chapman is the Communications Associate at the Pacific Council on International Policy.

The Pacific Council’s Summer Teleconference Series continues with discussions about South Asia’s water crisis on August 10; the U.S.-Russia relationship on August 24; and Germany’s upcoming election on September 21. Read summaries of the previous discussions in the series here.

The views and opinions expressed here are those of the speakers and do not necessarily reflect the official policy or position of the Pacific Council.