Mexico readies for worst as 4th round of NAFTA talks open

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US and Mexican business leaders warned that talks on a new North American Free Trade Agreement (NAFTA) could collapse because of hardline demands from US President Donald Trump's administration.

It's no secret that the president is not a fan of NAFTA, but Wednesday's remarks suggested he's open to the possibility of a bilateral trade deal with Canada.

And he happened to be doing so at the very moment his successor Justin Trudeau was a few blocks away at the White House, discussing the same issue with the USA president.

Trump ordered a renegotiation of NAFTA and threatened to pull out of the pact if the United States did not get a better deal in talks between the US, Mexico and Canada that began in August to revamp it.

"We'll see if we can do the kind of changes that we need", Trump said.

The US side sees strengthening the rules of origin for the auto industry as a way to bring back automotive production and jobs from Asia. "Two countries that are interwoven in our economies and our cultures and our peoples", Trudeau said.

"An abrupt exit from NAFTA would be more of a loss for USA exporters than for Mexican ones", he said.

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"But we have a good partnership. and that's why having an ongoing constructive relationship between the president and the prime minister is really important".

This comes as trade officials announce NAFTA talks in Washington will be extended for two more days.

"I think it's been clear that circumstances are often challenging, and we have to be ready for anything - and we are", Trudeau said.

It wasn't clear whether the change in the prime minister's NAFTA message was a direct result of his meeting with the USA president, someone he acknowledged "makes decisions that surprise people sometimes".

US-based Boeing alleges that Bombardier gets unfair subsidies from the Canadian and British governments.

The two North American leaders are expected to discuss NAFTA and other trade issues during Trudeau's visit.

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