ADJUSTMENTS: Administration poised to propose keeping deal’s major planks
WASHINGTON — President Donald Trump, who has called the North American Free Trade Agreement “the worst trade deal” ever signed by the U.S., appears to have softened one of the hard-line positions that animated his presidential campaign.
He is set to propose keeping major planks of NAFTA in place, according to a draft letter to Congress that lays out goals for renegotiating the trade pact with Canada and Mexico.
But his administration is seeking to add more protections for American products and industries. A proposed new provision would allow tariffs to be reinstated if a flood of imports threatened to harm a domestic industry. Trump also wants to adjust the agreement’s rules of origin, or how much of a product must be made in a NAFTA country. And he wants NAFTA partners to expand the market for U.S.-made goods in their government procurement.
“In terms of what we consider to be President Trump’s economic nationalist objectives and what he has said
previously about NAFTA, the list of negotiating terms was relatively benign,” said Scott Lincicome, an international trade lawyer.
Trump had often said that the United States could abandon NAFTA altogether if renegotiating it was not possible. He has signaled he wants to move swiftly to reorder the nation’s trade policies, and Wilbur Ross, the commerce secretary, said during his Senate confirmation hearing that addressing NAFTA would be among his first priorities.
But the hawkish rhetoric of the campaign has given way to more measured statements on trade from the administration that track more closely with the stance of many congressional Republicans, who are avid promoters of free trade and deeply skeptical of policies they view as restrictive or protectionist.
The tone of the eightpage draft letter did not echo Trump’s campaign speeches. Nowhere is there a mention of threats to pull out of the agreement.
But the letter, signed by Stephen Vaughn, acting U.S. Trade Representative, did say, “The persistent U.S. deficit in goods trade with Canada and Mexico demands that this administration take swift action to revise the relationship to reflect and respond to 21st century challenges.”
Antonio Ortiz-Mena, a former Mexican trade official, said the letter suggested a softening in tone, but it also contained several proposals that would likely prompt a strong response from Mexico.
“There are some specific problems,” said Ortiz Mena, now a senior adviser at Albright Stonebridge Group in Washington. “But in terms of the language used during the campaign and at the beginning of the administration, it’s not as far-reaching as some people could have expected.”
The assessment that the actual U.S. policies might not end up being as harsh as those espoused by Trump during the campaign is reflected in the Mexican peso. Since the inauguration, measured against a basket of currencies, it has gained about 17.5 percent in value.
Canada on Thursday declined to comment directly on the draft proposals, since NAFTA negotiations have not begun.
“We’ve got a long ways to go,” Sen. Sherrod Brown, D-Ohio, told the Associated Press. “President Trump made big promises to working people in Ohio, and I’m ready to work with him to deliver on those promises or hold him accountable if he doesn’t.”