Sunday, 22 July, 2018

Trump Calls On Canada, Mexico Not To Manipulate Their Currency

Trump Calls On Canada, Mexico Not To Manipulate Their Currency Trump Calls On Canada, Mexico Not To Manipulate Their Currency
Melinda Barton | 18 July, 2017, 06:53

President Richard Trumka of the AFL-CIO, an umbrella organization of unions representing 12.5 million workers, said the North American Free Trade Agreement had been an "unequivocal failure" and should be completely renegotiated. His team on Monday finally outlined what it thinks a better deal would look like.

Trump's US trade representative, Robert Lighthizer, is expected to publish a list of goals for the upcoming renegotiation of NAFTA, the free trade agreement among Canada, Mexico and the United States.

Top of the list: Cut the USA trade deficit with Mexico.

NAFTA has quadrupled trade among the three countries, surpassing $1 trillion in 2015, but the USA trade deficit with Mexico exceeded $63 billion previous year. The U.S. didn't have a deficit with Canada previous year.

But one expert predicted that - based on the extensive list of goals outlined Monday by the Office of the U.S. Trade Representative - renegotiations are going to be far from swift. Arizona exported more than $10 billion in goods to Mexico and Canada past year, trade that is likely to be affected by changes to the North American Free Trade Agreement. The chamber said that since NAFTA took effect in 1994, USA trade with those two countries has almost quadrupled to $1.3 trillion annually.

The US government said trade deficits and market access would top the agenda as it renegotiated trade terms with Mexico and Canada. More than $1 billion in commerce crosses the southern and northern borders of the United States every day.

"I regard this document as a potential iron first in a velvet glove", says Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics. The U.S. Commerce Department in June rolled out a new round of tariffs on Canadian softwood lumber. That goal, titled "Trade remedies", adds to the perception that Trump is seeking a protectionist policy, analysts say. "Any renegotiation that starts off with the current trade template found in TPP is unacceptable", he said.

The report calls for higher labor standards across all three countries.

According to the Nafta blueprint released Monday, the US would also seek to raise labor standards significantly for Mexican imports. Those were all key parts of TPP.

Democratic Representative Debbie Dingell from MI. which is home to large automakers like Ford, General Motors and Fiat Chrysler, said she offered to work with the administration if it was serious about the talks.

Rep. Martha McSally, R-Tucson, led a delegation of border district representatives who met with Commerce Secretary Wilbur Ross to discuss NAFTA's impact on their communities. A trade deficit with Mexico means American businesses and individuals bought more goods and services from Mexico than Mexicans bought from the United States.

As for Trump's top goal - reducing trade deficits - experts aren't convinced the move would bring manufacturing back manufacturing jobs, as Trump has promised.

"If it comes out that it is not a good deal, no deal is better than a bad deal", Trumka said. Over a decade to 2010, however, the United States lost almost 6 million manufacturing jobs.

Mexico's economic ministry declined to comment. Canada and Mexico have already agreed to upgrade these areas as part of the defunct Trans-Pacific Partnership trade deal.