Tension surrounds NAFTA negotiations over low Mexican wages

As thousands of workers marched in Mexico City demanding higher wages and better working conditions on Sunday, representatives from Canada, the U.S. and Mexico were negotiating about labour standards behind closed doors nearby.

Jerry Dias, president of the Canadian union Unifor, tells CTV’s Richard Madan in Mexico City that those labour standards are so divisive that they could be the tipping point that kills the North American Free Trade Agreement. He said the talks “should collapse over labour.”

A Quebec-based auto parts factory in San Juan del Rio, Mexico, shows why there is so much tension. Workers at the Exo-s factory, which gave CTV News rare acess, make as little as $40 per week – about the same that Canadian and American factory workers make in one hour.

"The government could give us much more, but the truth is, they pay us very little," one worker there said.

U.S. President Donald Trump – along with Canadian labour unions like Unifor – blame low wages like that for taking away jobs.

But Francois Ouellette, manager of the Exo-s factory, says it’s complicated.

“This is a market condition,” he said, pointing out that the company is paying competitive wages in Mexico and creating jobs there.

Low wages in Mexico are also offsetting high overhead in other North American factories and supporting high-wage head office jobs, he said.

“By being present here we are able to sustain and to help keep jobs in Canada and also in the states,” Oullette said.

Unifor President Jerry Dias doesn’t see it that way, siding with Trump about the need to reduce the cost advantage of building in Mexico.

“If governments don’t have the courage to fix it, then they should have the courage to walk away,” Dias said.

With a report from CTV’s Richard Madan in Mexico

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