President Donald Trump announced today via Twitter that a new, “big” trade agreement with Mexico “could be happening soon.”
“Our relationship with Mexico is getting closer by the hour. Some really good people within both the new and old government, and all working closely together….A big Trade Agreement with Mexico could be happening soon!”
As Reuters news agency pointed out, Trump is a known critic of the previous framework of the North American Free Trade Agreement, or NAFTA, and has repeatedly called it a “disaster” for American workers.
As Politico reported on August 21, citing individuals familiar with the matter, the Trump administration is almost ready to formally announce that it has reached a “breakthrough” in NAFTA talks with Mexico. This, Politico noted, could pave the way for Canada to rejoin the modernized, re-negotiated free-trade pact.
According to Politico‘s sources, the formal announcement was expected to be made by August 25. The president’s recent tweet, although short of a formal announcement, gives credence to reports that an agreement is indeed about to be formalized.
According to CNBC, however, Ildefonso Guajardo Villarreal — Mexico’s secretary of economy — said that the new NAFTA deal would require all three sides (Mexico, U.S., Canada) to be present. Citing its own West Wing sources, CNBC noted that Tuesday’s news about President Trump’s former lawyer, Michael Cohen, may have postponed the formal announcement, being that the news turned out to be a “major distraction.”
Trump says U.S.-Mexico trade deal could be imminent https://t.co/IPyYkFK4Gg— Reuters Top News (@Reuters) August 25, 2018
As Al Jazeera noted, Donald Trump infamously called NAFTA “the worst trade deal ” in U.S. history, blaming it for the wiping out of U.S. manufacturing jobs, and for the relocation of American companies to new addresses south of the border, where labor is cheaper.
NAFTA came into effect on January 1, 1994. It was signed by U.S. President George H.W. Bush, Mexican President Carlos Salinas, and Canadian Prime Minister Brian Mulroney. According to Al Jazeera, the primary aim of NAFTA was to make it easier for all three countries to conduct business across borders.
While the POTUS may have repeatedly threatened to withdraw from NAFTA, expressing strong dislike for it, researchers have mostly found the deal to have had mixed effects on the U.S. labor force. But, Al Jazeera noted, Trump can set the withdrawal in motion without congressional approval, so his threats can be interpreted as something more than a toothless bluff.
In June of this year, as the Washington Examiner reported, Democrats urged the Trump administration to continue working on a renegotiated trade deal with both Mexico and Canada, urging the administration to conclude the deal by the end of 2018.