US wants Nafta deal to shrink trade deficit

THE US has launched the first salvo in the renegotiation of the 23-year-old North American Free Trade Agreement (Nafta), saying its top priority for the talks was shrinking the US trade deficit with Canada and Mexico.

In a much-anticipated document sent to lawmakers on Monday, US Trade Representative Robert Lighthizer said he would seek to reduce the trade imbalance by improving access for US goods exported to Canada and Mexico under the three-nation pact.

For the first time in a US trade deal, the administration also said it wants an “appropriate” provision to deter currency manipulation by trading partners. The move appeared aimed at future trade deals rather than specifically at Canada and Mexico, which are not considered currency manipulators.

The 17-page document asserted that no country should manipulate its currency exchange rate to gain an unfair competitive advantage, an often-cited complaint about China in past years.

Shortly before the release of the document, US President Donald Trump lashed out against trade deals and unfair trade practices, saying he would take more legal and regulatory steps during the next six months to protect American manufacturers.

Canadian Minister of Foreign Affairs Chrystia Freeland said the US list was “part of its internal process”.

Nafta has quadrupled trade among the three countries, surpassing $1 trillion (R12.97trln) in 2015, but the US trade deficit with Mexico exceeded $63 billion last year. – Reuters