Will Mexico and Canada Be Willing to Reform NAFTA?

G. Philip Hughes (Barbados and Eastern Caribbean, 1990-1993)

Cross-posted from the Latin American Advisor, a publication of the Inter-American Dialogue

Also appears on the White House Writers Group website

President-elect Trump has been relentlessly critical of NAFTA from the beginning of his candidacy. After almost a quarter century, it is perfectly plausible that the tripartite NAFTA agreement could use a review—updating and improvement. President Trump will certainly have the power and authority to propose—and, if necessary, insist on—re-negotiating NAFTA with Mexico and Canada. It is hard to see how or why Congress would try to stop him. But if they don’t already know, USTR-designate Richard Lighthizer, and Commerce Secretary-designate Wilbur Ross will soon discover that Mexico and Canada will have their own lists of grievances, frustrations, demands and ambitions for a re-opened NAFTA negotiation. The result will be a product of give-and-take horse-trading—just as NAFTA is. Only better, the administration will explain. It would have to be. Where can you go but up from what Mr. Trump calls ‘the worst trade deal … in the history of the world’? Re-negotiating NAFTA, in whole or part, is plausible and probably do-able. Abrogating NAFTA is not. While the ability to ‘walk away’ is a hallmark of ‘The Art of the Deal,’ the new Trump trade team must know that, over the last two decades, the production base of most of the U.S. economy’s real sector has become quite thoroughly integrated across the Canadian and Mexican borders. Disrupting that would play havoc with supply chains, prices and employment on a continental scale—probably not a sure-fire vote-getting strategy.

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