Trump, Canada, Mexico and NAFTA

By Daily Editorials

November 23, 2016 3 min read

President-elect Donald Trump has said on various occasions that he wants to rip up such "disastrous" international trade agreements as the North American Free Trade Agreement and force other countries to renegotiate the terms and conditions to his liking.

Well, one world leader has expressed the desire to discuss that with the (demanding) Donald.

Canadian Prime Minister Justin Trudeau had a short phone conversation with Trump on Nov. 10. He then told reporters during a press conference in Sydney, Nova Scotia, "If Americans want to talk about NAFTA, I'm happy to talk about it."

A day later, Mexico's foreign affairs minister, Claudia Ruiz Massieu, said her government was prepared to talk about NAFTA, too. (Trudeau and Mexican President Enrique Pena Nieto have also reportedly chatted about trade in the past few days.)

America's NAFTA partners may have begun opening their ears to Trump, but will the president-elect actually get his way? And if he doesn't, will this trade deal collapse like a house of cards?

That would be a political and economic disaster for North America.

Trump has been critical of NAFTA because some blue-collar Americans have lost jobs to inexpensive, nonunionized Mexican workers. (His issues with Canada's role in this trade agreement have been slim to none.) While that is true, and any job losses hurt real people and their families, NAFTA has clearly benefited all three countries economically.

The Congressional Research Service's M. Angeles Villarreal and Ian F. Fergusson noted in an April 2015 paper that while "NAFTA was controversial when first proposed, mostly because it was the first (free trade agreement) involving two wealthy, developed countries and a developing country," it has not caused "the huge job losses feared by the critics or the large economic gains predicted by supporters."

And while trade with Canada and Mexico accounts for only a small percentage of America's GDP, the overall impact of NAFTA has been impressive.

Canada has long been one of America's biggest trading partners. The two countries reportedly exchanged about $670 billion in goods and services during the previous fiscal year. Imports from Mexico have also skyrocketed by an astonishing 251 percent from 1993 to 2014. This has helped Mexico remove some of its financial shackles, giving its people real hope for the future.

Crippling tariffs in all three nations have been reduced or eliminated on a wide variety of products, new markets are constantly emerging, and job opportunities continue to increase.

Beyond campaign rhetoric, Trump has not spelled out how he would improve NAFTA. A better deal with our neighbors would be ideal, but it is important to remember that free trade and robust markets tend to grow opportunities for everyone. We do not want to strangle those.

REPRINTED FROM THE PANAMA CITY NEWS HERALD

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