Why has President Trump launched a renegotiation of the North American Free Trade Agreement? What are...

Why has President Trump launched a renegotiation of the North American Free Trade
Agreement? What are the debates and main issues at hand?

Expert Solution

It was in May 2017 that the Trump administration formally notified Congress about its intention to renegotiate the North American Free Trade Agreement (NAFTA). It starts the clock on a 90 day period. The actual renogiations started in August 2017. The renogiations is between U.S Mexico and Canada. As nothing happened even in the third round of negotiation, the new deadline could be July 2018 now. U.S trade representative Robert Lighthizer is appointed to represent The U.S at the renegotiation by President Trump. According to the President NAFTA is a horrible deal for the U.S and also the worst trade deal ever or a defective agreement. But the administration would rather like to take up the issue and try to correct it further and hopes to improve and update the deal rather than scrap it altogether.

Debates and main issues of NAFTA

Though it has benefitted the US economy overall by increasing trade but it is believed that the benefits are overall distributed over US population bu the smaller group of people are not much benefitted.
There are problems of economic growth and job creations which needed to be sorted out.
High standards of trade agreements needs to be created that not only strengthens the vital trade pact but also preserves the strong economic partnerships with Canada and Mexico.
Need to lower the trade deficit between U.S amd Mexico.
Eliminate unfair subsidies and stronger protection for US digital trade and intellectual properties.
They also want the state owned companies of Mexico to operate more like private corporations.
To end the dispute resolution panel as it erodes the sovereignty of U.S courts.
The Trump administration also wants to update the rule of origins.
It wants its trade partners to open up more of their government contracts to US companies.
U.S would like Mexico to end its value added tax on US Companies.
Mexico and Canada wants US to allow its trucks on U.S roads.
Canada wants U.S to end tariffs on its lumber and dairy products.
Canada and Mexico both want increased access to business travellers alongwith gender rights in the agreement.

Rahul Sunny answered 2 years ago

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