New Nafta deal will boost US economy

176K US jobs will be added through new North American trade deal

washington — The US International Trade Commission estimated the proposed new North American free trade deal would modestly boost the US economy but could reduce US vehicle production.

The economic assessment of the US-Mexico-Canada Agreement, released on Thursday, said the trade deal would increase US real gross domestic product by 0.35 per cent, or $68.5 billion, on an annual basis and add 176,000 US jobs, while raising US exports.

The report’s estimates are for year six of the trade deal, once it is fully implemented.

Auto industry employment would rise by 30,000 jobs for parts and engine production, but US vehicle production would decline in and US vehicle consumption would be reduced by 140,000 units because of higher prices, or 1.25 per cent of 2017 sales, the report said.

The report may give ammunition to opponents of the deal. The leaders of the three countries approved the deal last year, but it still must be approved by the US Congress. The deal is a replacement for the more than two-decade-old North American Free Trade Agreement.

The auto industry had been a key focus of the deal for the Trump administration.

The report also found that 1,500 US vehicle manufacturing jobs would be lost and the price of new US vehicles would rise from 0.4 per cent for pickup trucks to 1.6 per cent for small cars.

Some automakers may decide “not to offer vehicles that would be too expensive to bring into compliance, which would ultimately decrease consumer choice,” the report said.