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Inside the executive order that would've yanked the US out of Nafta
May 25 2017, 08:52 | Alonzo Simpson
Trump tells Canada, Mexico, he won't terminate NAFTA treaty: White House
Yet so far, his trade policy has produced mostly confusion and division, even among fellow Republicans.
It is understood that the Trump administration had been weighing whether to issue an executive order withdrawing the United States from the North American Free Trade Area as early as the 100 day since the inauguration which will be marked on April 29 on Saturday. This week, the White House announced new tariffs on Canadian softwood lumber imports, and the president said usa milk was being blocked from Canadian markets. Canada and Mexico were blindsided by reports that Trump meant to back out of NAFTA, and business leaders rallied against the move.
"U.S. dairy exports support approximately 110,000 jobs across America, many of which are in farming and food manufacturing, as well as in supporting rural manufacturing and skilled farm service workers", the organizations said in the letter.
President Trump still calls the North American Free Trade Agreement "a awful deal" for the United States. The U.S. Chamber of Commerce estimates that almost 14 million American jobs depend on trade with Canada and Mexico.
Although Mr. Trump's campaign denunciation of NAFTA as "the worst trade deal maybe ever signed anywhere" focused largely on Mexico, the new administration's first trade initiatives have addressed complaints about Canada from USA dairy farmers and the lumber industry. One way to appreciate its significance is to see it in the light of the long, uneasy history of U.S. He often said he would either "get rid of it" or "terminate it" or "renegotiate" it. Canadians and some Americans claim American construction costs will go up, dampening US economic growth, if higher tariffs on Canadian lumber are imposed. The renegotiation of NAFTA has yet to be formally launched, but the infighting is already underway.
Hours after White House officials disclosed on Wednesday that Trump and his advisers had been considering an executive order to withdraw from NAFTA, he said he received telephone calls from Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau. "And I said I've had it". Trade among the three countries is much more robust and supply chains more tightly integrated than was the case in 1994 when NAFTA went into effect.
Neither Videgaray nor Trudeau mentioned whether the Mexican and Canadian governments were in communication or co-ordinated their efforts.
In Mexico, Foreign Minister Luis Videgaray warned Thursday that the end of NAFTA was "a real possibility".
Congressman Beto O'Rourke, who is from El Paso and is now running for a spot in the U.S. Senate, said that his region of West Texas was devastated by NAFTA initially, with thousands of manufacturing jobs moving south of the border nearly overnight.
Jorge Guajardo, a former Mexican diplomat and senior director at the Washington-based global strategy firm McLarty Associates, said he doubted it was merely a ploy to twist the arms of US lawmakers.
"You saw that, you wrote about it", Trump said.
"I think Trump knows how to talk tough, and his supporters have come to expect him to be that way, but he's also come to recognize... that protecting the USA market comes at a huge cost", said Daniel Ikenson, director of trade policy studies at the Cato Institute.
"So, they asked me to renegotiate (and) I will".
But, he added, "we're going to give renegotiation a good, strong shot".
The dispute played out in the media Wednesday, with several outlets saying Trump would take the most dramatic available option-issuing an order declaring his intention to withdraw from the treaty. Last year, as the president likes to point out, the USA ran a trade deficit with Mexico of $63 billion. I think it's unnecessary.