Perdue Weigh in on NAFTA Renegotiations

During the U.S. presidential election, Trump called the trade deal "a disaster", and Thursday, U.S. Commerce Secretary Wilbur Ross said the Trump administration was putting the U.S. Congress, as well as trading partners Canada and Mexico, on notice that "free and fair" trade is going to be the new standard for the U.S.

"Our focus in Canada is on getting a good deal", she said, noting that the renegotiation needs to be done in a "trilateral fashion", with Canada, U.S. and Mexico all at the table together. The agreement also encourages higher export volumes; according to the US Department of Commerce, Michigan - where the US auto industry is primarily concentrated - exported $23.5 billion in goods to Canada in 2015, and $11.7 billion in goods to Mexico.

"As a starting point for negotiations, we should build on what has worked in NAFTA and change and improve what has not", Lighthizer said.

He added that the agreement was outdated and did not reflect modern standards.

"While NAFTA has been an overall positive for American agriculture, any trade deal can always be improved", Perdue said.

Lighthizer's letter is less detailed than a draft sent to lawmakers in March, which listed as objectives tax equality and the ability to re-impose tariffs if Mexican and Canadian imports pose a serious injury threat to USA industry.

"Eliminating loopholes that shift production to third-party countries like China and devoting more customs enforcement resources to stop illegal third-country trans-shipments are two changes that would make the agreement better", he said. TPP's objective was precisely to establish a modern approach to free trade by encompassing new products and services - sectors in which the US has most to gain - and by making labor and environmental standards easier to enforce.

The Mexican government says it "welcomes" the opportunity to renegotiate NAFTA. At the joint news conference, Videgaray told reporters that the Mexican government welcomes NAFTA renegotiations, which he said will "make our trade agreement better - better for the people of Mexico, the people of the USA, and the people of Canada". Mexico, which imported $17.9 billion in US food, was the third-largest market. Talks with Canada and Mexico can begin after that.

"CPMA supports an integrated North American market for fresh produce", said Ron Lemaire, President of CPMA. During the 1992 presidential campaign, independent candidate Ross Perot famously predicted a "giant sucking sound" as NAFTA pulled USA factory jobs south of the border into Mexico. Because this is what allows us to maximize the competitive potential of the region that should be the most competitive one in the world, North America, " Videgaray said.

U.S. Wheat Associates and the National Association of Wheat Growers are also hoping for caution in the upcoming negotiations. "Obviously, dairy trade with Canada - where we continue to face 200%-300% tariffs and a slew of nontariff policies that distort dairy trade - is an entirely different story, and we need to address it as part of these talks".

  • Zachary Reyes