Talks on renegotiating the North American Free Trade Agreement (NAFTA) continued for the third straight week last week, as representatives from the U.S., Canada and Mexico pushed to finalize an updated deal, reports the National Pork Producers Council.
The organization “continues to urge the Trump administration to maintain zero-duty market access for U.S. pork exports to Canada and Mexico and to caution that agreement termination would be detrimental for the U.S. pork industry, costing an estimated $1.5 billion,” NPPC said in a news release.
Trade Deficit with Mexico
Farmers have been patient on the negotiations, but their patience is wearing thin, despite recognizing that a trade deficit with Mexico exists. According to an article on The Balance website by Kimberly Amadeo, American bought $71 billion more imports from Mexico than Mexico bought from the U.S. There is also a deficit in trade with Canada, but it’s smaller.
“The Trump administration wants to end the dispute resolution panel,” Amadeo wrote. “These arbitration panels rule on whether a NAFTA country treated a partner's overseas investments unfairly. The panels make sure U.S. corporations maintain the rights protected by the U.S. Constitution.”
Amadeo reported that U.S. Commerce Secretary Wilbur Ross suggested a five-year sunset clause, which “would force the signatories to recommit every five years. The business community immediately pushed back. It would not invest in the new agreement's rules if they could be revoked in five years.”
A Delicate Balance
Trade agreements have many moving parts, and what helps one industry can very likely hurt another. Agriculture has borne the brunt of trade issues with both NAFTA and China this year, and hope for resolution to both situations in the near future.
Pork producers are also advocating for the initiation of bilateral negotiations for a free trade agreement with Japan. According to NPPC, Japanese Economic Revitalization Minister Toshimitsu Motegi was in Washington last week for discussions with U.S. Trade Representative Robert Lighthizer.