MEXICO CITY- Mexico is taking U.S. President Donald Trump's threats to leave the North American Free Trade Agreement more seriously as a second round of talks opens Friday in Mexico City on renegotiating the 1994 trade pact.

Trump on Sunday tweeted that Mexico and Canada are "both being very difficult, may have to terminat." And Mexico now says it is developing a "Plan B" in case Trump withdraws from the trade pact.

Mexico's Economy Secretary Ildefonso Guajardo told the country's Senate that the country has to have an alternative plan. In his words, "A scenario without NAFTA is something we have to think about."

Guajardo says key sticking points include U.S. demands to modify NAFTA's dispute resolution process and tighten labor standards.