The United States, Mexico and Canada dove into the details of revamping the North American Free Trade Agreement at a second round of talks Friday, amid threats from President Donald Trump to axe the deal.
After setting an ambitious "accelerated" calendar during the first round -- held in Washington from August 16 to 20 -- negotiators got down to the nitty gritty business of modernizing the 1,700-page deal as five days of talks opened in Mexico City.
Trump doubled down on his anti-NAFTA rhetoric in the build-up to the second round, saying Mexico was "being difficult" and that the United States would "end up probably terminating" the deal, which he says has been disastrous for US industry and jobs.
"We have to consider the possibility" that the US could pull out of the deal, said the head of Mexico's Business Coordinating Council, Juan Pablo Castanon, who has represented the private sector in talks with the Mexican government.
"If NAFTA ceases to exist... the impact would be an average four percent that we would have to pay to export there. We have to immediately lower costs for companies, introduce incentives to export elsewhere," he told Mexican TV network Televisa.
In Mexico, which sends 80 percent of its exports to the United States, the government has dismissed Trump's threats as posturing.
Trump himself has sent mixed signals about the deal.
On Thursday, he and Canadian Prime Minister Justin Trudeau spoke on the phone and "stressed their hope to reach an agreement by the end of this year," according to the White House.
Most experts now say NAFTA is likely to survive with modest changes -- though with Trump, nothing is certain, they warn.
The Republican president may ultimately have little room to maneuver, however.
Some 14 million US jobs depend on trade with Mexico and Canada, according to the US Chamber of Commerce.