Trump Administration Triggers NAFTA Renegotiation Process

May 18, 2017 Share Print 0

The Trump administration on Thursday formally launched its effort to renegotiate the North American Free Trade Agreement with Canada and Mexico to try to win better terms for U.S. workers and manufacturers.

With a letter to U.S. lawmakers, U.S. Trade Representative Robert Lighthizer said he triggered a 90-day consultation period with Congress, U.S. industries and the American public that would allow talks over one of the world’s biggest trading blocs to begin by Aug 16.

usdcad Canadian dollar graph, May 18, 2017

Renegotiation of NAFTA was a key campaign promise of U.S. President Donald Trump, who frequently called the 23-year-old trade pact a “disaster” that has drained U.S. factories and well-paid manufacturing jobs to Mexico.

Lighthizer told reporters that NAFTA has been successful for U.S. agriculture, investment services and the energy sector, but not for manufacturing. He added that he hopes to complete negotiations by the end of 2017.

“As a starting point for negotiations, we should build on what has worked in NAFTA and change and improve what has not,” Lighthizer said in a conference call with reporters. “If renegotiations result in a fairer deal for American workers there is value in making the transition to a modernized NAFTA as seamless as possible.”

In his letter to congressional leaders, Lighthizer said NAFTA needs modernization for digital trade, intellectual property rights, labor and environmental standards, rules for state-owned enterprises and food safety standards.

via Reuters

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.