What is Trump administration proposing to do about NAFTA, actually?

In the end these seem like fairly narrow issues to negotiate, and the other parties presumably have some aspects of the agreement that they also would like to change.

In a draft letter circulated among members of Congress this week, the administration proposed adding a provision to allow tariffs to be reinstated if a flood of imports threatens to harm a domestic industry. Mr. Trump also wants to adjust the agreement’s rules of origin, or how much of a product must be made in a Nafta country. And he wants Nafta partners to expand the market for United States-made goods in their government procurement ….  The letter calls for expanding market access among the three countries and eliminating licensing and permit barriers that tend to stall commerce. It also calls for maintaining “reciprocal access” for textile and apparel products.  Rather than scrap Nafta’s arbitration tribunals, regarded by some free-trade critics as secretive bodies that give private corporations unbridled power to challenge foreign governments outside the court system, the letter proposed to “maintain and seek to improve procedures” for settling disputes.  It made no mention of currency policy, an issue many trade experts had thought might be on the table.  The administration did give itself room to get tougher. The proposal for reinstating tariffs, often referred to as a snapback, was billed as a “safeguard mechanism” to protect domestic industries. The draft also suggested efforts to “level the playing field” on tax treatment. Such measures could bring objections from Canada and Mexico

About mkevane

Economist at Santa Clara University and Director of Friends of African Village Libraries.
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