Efforts to revise NAFTA begin
WASHINGTON — Of all the trade deals he lambasted on the campaign trail as threats to American workers, President Donald Trump reserved particular scorn for one: the North American Free Trade Agreement.
The NAFTA agreement with Mexico and Canada was “the worst trade deal in history,” candidate Trump declared.
He accused NAFTA of having swollen America’s trade deficit with Mexico, pulled factories south of the border and killed jobs across the United States.
Trump promised to renegotiate the 23-year-old deal — or walk away from it. Now the time has come. Five days of talks aimed at overhauling NAFTA begin Wednesday in Washington, with negotiations to follow in Mexico and Canada.
The United States has never before tried to overhaul a major trade agreement. But it’s clear that delivering on Trump’s campaign promises will be difficult. A new version of NAFTA would require approval from a divided Congress. And even an improved NAFTA might not deliver the payoff Trump and his supporters are hoping for: The restoration of millions of lost manufacturing jobs.
Economists and trade analysts do see opportunities to improve NAFTA, which eliminated most barriers on trade among the United States, Canada and Mexico. If nothing else, the pact could be updated to reflect the growth of the digital economy.
A more aggressive approach — demanding more made-inAmerica content for products that qualify for NAFTA’s dutyfree status, for example — risks imperiling some benefits that Americans think the trade deal provided to them.
Last month, the Trump administration listed its objectives for the renegotiation. Some of them will meet fierce resistance from Canadian and Mexican negotiators. The administration has riled Canada, for example, by saying it wants to eliminate a disputeresolution process established under NAFTA.
Renegotiating NAFTA is part of the administration’s plan to restore a chunk of the 7 million factory jobs America has lost since U.S. manufacturing employment peaked in 1979.