Arizona Business Leaders Watching NAFTA Renegotiation Closely

Trump Tells Canada And Mexico He Will Renegotiate, Not Withdraw From NAFTA

"The president said he "was going to terminate NAFTA as of two or three days from now", but after the two leaders - both of whom he had "a very good relationship" with - called him and said, "'Rather than terminating NAFTA, could you please renegotiate, '" he chose to put it on hold. "And, while we must improve our trade policies to put hardworking heartland families first, this needs to be done in a thoughtful strategic way that does not cause further damage".

Trump would hold separate calls between the Canadians and the Mexicans.

"Why are we importing steel from the United States to go into cars in Canada while we have a major steel plant that is under capacity?" And it's not clear anyone's palms are sweating over the risk that NAFTA talks derail, the status quo continues, and Trump's big campaign promise to renegotiate crashes into oblivion.

Having separate deals rather than one common market seems to be Trump's true preference anyway.

The reports that Trump might withdraw from NAFTA were followed by a sharp drop in the value of the Mexican peso against the USA dollar.

Prime Minister Justin Trudeau stressed to Trump that cancelling the trade accord would affect thousands of Canadian jobs that rely on the measures outlined in the free-trade agreement.

The president's gyrations over NAFTA have been especially puzzling.

It's the fifth time since 1981 that Canada and the USA have sparred over softwood, and Canada has prevailed every time it has challenged the US through the North American Free Trade Agreement, the World Trade Organization or in the US court system.

Lower taxes in the USA, still by far our largest trading partner, combined with rising taxes in Canada, can only end badly for Canadians.

Then, in March, the administration sent a draft letter to Congress spelling out plans to renegotiate NAFTA.

Without NAFTA, they wouldn't.

Trump has complained in recent days about US dairy farmers who have been locked out of Canada's milk market.

The reversal surprised markets, sending the Mexican peso and Canadian dollar higher after losses earlier this week.

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This includes urging the Trudeau government to retaliate by banning thermal coal exports from B.C. ports to the U.S.

Trudeau said the president seriously raised the possibility.

Trump has accused Mexico of luring away American factories and jobs with cheap labor and other advantages enabled by NAFTA.

"And I think we'll be successful in the renegotiation, which frankly would be good", adding that it "would be simpler" than killing Nafta. "Withdrawing from #NAFTA would be a disaster for #Arizona jobs & economy", tweeted Republican Sen.

Sen. John McCain of Arizona had a similar warning for Trump. Then again, just Thursday he threatened to terminate a bilateral trade agreement with South Korea, calling it too "a terrible deal" that's left America "destroyed". Trump even got on the phone with his Canadian and Mexican counterparts, and the White House issued a late-night statement saying a consensus emerged to renegotiate the trade deal that Trump pilloried as a candidate.

"I believe it's very important that you have free trade, but we don't have free trade right now".

Trudeau said Trump agreed NAFTA will benefit all of the countries involved.

Could Politico have overstated the power of the nationalist trade faction within the Trump White House? Barnyard squeals emanated from every imaginable sector of the agriculture industry: pork producers called the idea devastating, corn producers called it disastrous and the head of the US grains lobby said he was shocked and distressed.

Media reports on Wednesday had suggested Mr Trump was drafting an executive order to end the pact. "Unilateral threats of withdrawal or demands for renegotiations risk triggering yet more protectionist moves across the globe". Instead, he said the deal will be renegotiated.

Agricultural interests also would benefit from changes to NAFTA, said Tamara Nelsen, senior director of commodities for the Illinois Farm Bureau.

Garry Douglas is a trade expert with the Chamber of Commerce in the border city of Plattsburgh, N.Y. He says he hopes President Trump's tough talk is a negotiating position, a way to frame the NAFTA talks before they start. "Talking about it is much easier than actually doing it".

The moves came days after the administration announced it would slap hefty tariffs on softwood lumber being imported from Canada.



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