Trump administration triggers launch of NAFTA renegotiations
- Author: Sonia Alvarado May 21, 2017,
May 21, 2017, 13:07
"President Trump is going to change that", he said.
Renegotiation of NAFTA was a key campaign promise of U.S. President Donald Trump, who frequently called the 23-year-old trade pact a "disaster" that has drained U.S. factories and well-paid manufacturing jobs to Mexico. He's been highly critical of the deal, blaming it for the steady loss of manufacturing jobs in the USA over the past several decades as automakers export jobs to Mexico, where part and vehicle assembly is cheaper.
While on the presidential campaign trail, Trump repeatedly censured United States membership in worldwide trade deals, pledging to renegotiate or withdraw the country from multilateral trade accords that for decades have served as foundations for global economics. "Today, that number is roughly 165,000 - and would have been heading down [bigly] if I didn't get elected, I will tell you that right now". "The net overall effect of NAFTA on the U.S. economy appears to have been relatively modest primarily because trade with Canada and Mexico accounts for a small percentage of U.S. GDP". Combined, those quantities represented roughly 66 percent of the states exports that year.
During the required consultation period, Lighthizer said he would consult with "Congress and American stakeholders to create an agreement that advances the interests of America's workers, farmers, ranchers and businesses", according to a statement.
Mexico has begun to seek alternatives to US food because, as its agriculture secretary, Jose Calzada Rovirosa, said in March, Trump's remarks on trade "have injected uncertainty" into the agriculture business.
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Lighthizer's letter said the White House is looking to improve "U.S. opportunities" under NAFTA, adding that many chapters of the trade accord are "outdated and do not reflect modern standards". In fact, US manufacturing exports to Canada and Mexico have increased almost 260% over the past 23 years, and USA farm exports to the countries have grown by more than 150%. "Congress looks forward to working hand-in-hand with the Trump administration to achieve the best deal possible for American workers and our economy", Ryan said in a statement. "It's very unfair to the American worker, and very, very unfair to companies that do business in the United States".
Trump has pledged to use the Nafta talks to shrink goods trade deficits that stood at $63 billion (€56.5 billion) with Mexico and $11 billion with Canada previous year, according to USA census bureau data. Canadian Foreign Affairs Minister Chrystia Freeland said talks will provide an opportunity to "align Nafta to new realities", while her Mexican counterpart Luis Videgaray said the three countries can reshape Nafta "under a win-win framework".
The Canadian and Mexican governments are prepared for NAFTA renegotiation discussions.
Mexico also said it expects a "constructive" negotiation.
In recent speeches, Donohue has said that 14 million American jobs depend on trade with Canada and Mexico and that the first objective of the administration should be to "do no harm". "If we all do our jobs well, the result will be a stronger agreement that spurs economic growth and job creation, not just in the United States, but across North America", he said.