Trump says will renegotiate, may exit NAFTA
President Donald Trump announced Friday he will demand renegotiation of the free trade agreement linking North America's economies, and will abandon the pact unless the United States gets "a fair deal."
The statement on the White House website, posted less than two hours after Trump took the oath of office, said the new administration will seek to change the terms of the 23-year-old North American Free Trade Agreement (NAFTA) with Canada and Mexico.
Trump condemned NAFTA on the campaign trail, claiming it had contributed to job losses, lost manufacturing and economic decline, and threatened to impose big tariffs on imports from Mexico.
"President Trump is committed to renegotiating NAFTA," the White House said. "If our partners refuse a renegotiation that gives American workers a fair deal, then the President will give notice of the United States' intent to withdraw from NAFTA."
Following the stark nationalist tones of Trump's inaugural address, the swift announcement was another sign the new administration intended to make good on a central theme of the campaign, which had attracted supporters in the industrial US midwest.
The rules established for free trade agreements like NAFTA allow the president to withdraw simply by notifying other parties. This would start a 180-day clock to allow for new negotiations.
But without a new agreement approved by the legislatures of all member states, the trade agreement would be dissolve.
The United States currently runs trade deficits with all major trade partners, Canada, Mexico and China, with the latter amounting to more than $30 billion a month, which helps fuel Trump's case.
However, according to the US Trade Representative, the United States exports about $2 trillion a year which supports 14 million US jobs.
The White House also announced the Trump administration's "pro-growth" plan to create 25 million jobs in a decade and nearly double economic growth to four percent a year, by cutting taxes on all income earners and slashing regulations.
The statement said former president Barack Obama presided over the loss of 300,000 manufacturing jobs. However, the sector was in decline before Obama entered office in 2009 due to the global financial crisis.
The US manufacturing labor force reached a trough in February 2010 and added 800,000 positions since then, while total employment increased by 15.6 million.