Trump Administration Announces Plans To Renegotiate NAFTA

Paterniano Del Favero
Mag 20, 2017

The United States officially served notice May 18 of its intention to renegotiate the agreement, triggering a 90-day consultation window before starting talks late this summer with Canada and Mexico.

Trucks wait in a long queue for border customs control to cross into the the Otay border crossing in Tijuana, Mexico on February 2, 2017.

But Mexican Foreign Minister Luis Videgaray on Thursday told reporters that "NAFTA is a trilateral treaty and must have a trilateral nature".

Gary Hufbauer, senior fellow at the Peterson Institute, says the United States could seek modest "technocratic" changes, including provisions to update NAFTA to reflect technologies that have emerged since the original agreement was negotiated.

"I don't care if its a renovation of NAFTA, or a brand new NAFTA, but we do have to make it fair", Trump said when he signed an executive order on the trade agreement on January 23.

"Since the signing of NAFTA, we have seen our manufacturing industry decimated, factories shuttered, and countless workers left jobless", Ross said.

Reacting to the announcement, NCTO president and CEO Auggie Tantillo said, "The US textile industry welcomes President Trump's decision to renegotiate NAFTA..."

In a statement Thursday, Dingell said it's important for the agreement to be renegotiated in a way that puts working families first, pushes job creation and gives a boost to manufacturing throughout the country.

"If we're going to get it right, American trade policy must be fair and have the support of Democrats and Republicans", Kildee said.

Trump early in his presidency ended America's participation in the TPP, which the Obama administration hadn't been able to persuade Congress to approve. The agreement eliminated numerous tariffs on trade between the US, Canada and Mexico.

Canada and the United States are unlikely to strike a deal on a dispute over lumber exports by the time talks on renewing NAFTA start in mid-August, a source close to the matter said on Thursday.

Susan Schwab, the USA trade representative in the George W. Bush Administration, said it's about time.

"NAFTA has been vital to the growth of the US insurance industry, but as with any agreement that's almost a quarter of a century old, NAFTA can be improved". American Farm Bureau "looks forward to working with the administration, Congress, other agricultural groups, and officials in Canada and Mexico to protect these important markets while also addressing issues that have limited the trade potential of US farmers and ranchers". That follows on the heels of disputes with Canada over lumber imports and dairy exports, and with Mexico over sugar imports, just a small sample of the many trade disputes announced in the last three months.

In February, the Congressional Research Service released a report on NAFTA, which found the trade agreement "did not cause the huge job losses feared by the critics or the large economic gains predicted by supporters".

Lighthize pledges to work closely with Congress throughout the negotiations and commits to providing "timely and substantive results for US consumers, businesses, farmers, ranchers and workers". In part, that's because trade represents a surprisingly small portion of the US economy - 28 percent in 2015, according to the World Bank, one of the lowest shares in the world.

He also noted that "Canada and Mexico have only limited room to make deep concessions to Washington, given their own domestic political situations".

In the letter to Congress, Lighthizer expressed the Trump Administration's "commitment to concluding the negotiations with timely and substantive results for United States consumers, businesses, farmers, ranchers, and workers".

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