WASHINGTON”•The United States on Monday said it would work to shrink trade deficits with Canada and Mexico in talks to renegotiate the landmark 1994 North American Free Trade Agreement (Nafta).
The Trump administration has focused on boosting domestic manufacturing while cutting trade deficits”•which it sees as damaging to the economy”•a move that risks undoing the free trade efforts of prior administrations.
The US Trade Representative said that when Nafta talks begin next month, Washington also will seek to lower trade barriers for produce and industrial goods”•while eliminating subsidies US officials say are unfair in trade with the two neighboring nations.
“President Trump continues to fulfill his promise to renegotiate Nafta to get a much better deal for all Americans,” US Trade Representative Robert Lighthizer said in a statement.
“Too many Americans have been hurt by closed factories, exported jobs, and broken political promises.”
USTR released the Nafta negotiating objectives as required prior to the start of the talks, which will be held under a pressing political timeline due to elections next year in the US and Mexico.
President Donald Trump retreated from his threat to exit Nafta, but has described the agreement as a “disaster” that has drained the US of wealth and jobs.
Mexico’s economic ministry said in a statement it “welcomes” the US objectives, saying they “will contribute to defining the issues on the negotiating table with greater clarity and the timeline for modernizing the agreement.”
Economists agree the trade pact”•which accounts for about $1 trillion in annual trade between the three nations”•can be updated.
But they have warned against attempting to reduce bilateral deficits, which would face practical hurdles and slim chances of success.
Jeffrey Schott of the Peterson Institute for International Economics said the US negotiating objectives were a plausible start to the process, but unlikely to achieve that stated goal.
