Trump administration launches NAFTA renegotiation process

Robert Lighthizer speaks after being sworn in as U.S. Trade Representative in Washington.   Thomson Reuters

Robert Lighthizer speaks after being sworn in as U.S. Trade Representative in Washington. Thomson Reuters

Last month, NPC provided a letter to the President that offered guidance on how to improve the two decade old NAFTA to the benefit of the potato industry.

"Since the signing of NAFTA, we have seen our manufacturing industry decimated, factories shuttered, and countless workers left jobless", Ross said in a statement. "We absolutely must not have any disruptions in exports to our No. 2 (Mexico) and No. 4 (Canada) markets", said Ken Maschhoff, NPPC president.

In his letter to congressional leaders, Mr Lighthizer said Nafta needs modernisation for digital trade, intellectual property rights, labour and environmental standards, rules for state-owned enterprises and food safety standards.

In fact, a draft letter the administration circulated on Capitol Hill earlier this year, before Lighthizer was confirmed, was far more detailed.

Groups that represent major USA auto companies in Washington have expressed measured support for Trump's proposal to renegotiate NAFTA.

"The way we're going to go about it is product by product, country by country", Commerce Secretary Wilbur Ross told CNBC Thursday, referring to trade policy generally. In recent weeks, President Trump had indicated an intention to terminate NAFTA, but decided instead to renegotiate the agreement after "pleasant and productive" conversations with President Peña Nieto of Mexico and Prime Minister Trudeau of Canada.

Mr. Trump was elected in part with a message of regaining American manufacturing jobs, and Mr. Lighthizer said Thursday that manufacturing will be a key focus of the talks.

At the time, Trump reportedly said: "We will be starting negotiations having to do with NAFTA".

Canadian Minister of Foreign Affairs Chrystia Freeland described NAFTA's record as "one of economic growth and job creation" across the continent.

Freeland said it was premature to speak about the timelines for the talks. Trump has pledged to dramatically increase US oil and gas production, but Canadian supplies will likely remain an important American energy source for some time.

US Chamber of Commerce president Thomas Donohue urged US officials to "do no harm" to businesses that depend on trade with Canada and Mexico and to move quickly on a new trilateral deal.

"He said that was quite intentional", she said. Since NAFTA went into effect January 1, 1994, US trade north and south of the borders has more than tripled, growing more rapidly than USA trade with the rest of the world.

A Canadian source close to the lumber negotiations said it was unlikely an agreement could be reached by mid-August, however.

The announcement came as Mexico's Foreign Secretary Luis Videgaray was meeting with US Secretary of State Rex Tillerson in Washington.

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