February 18, 2018

Why Donald Trump's combative trade stance makes US farmers nervous

20 May 2017, 12:33 | Taylor George

Eduardo Solis President of AMIA gestures during an interview with Reuters in Mexico City Thomson Reuters

Eduardo Solis President of the Mexican Automotive Industry Association, gestures during an interview with Reuters in Mexico City Mexico

She worries that a revamped NAFTA will include provisions left over from the Trans-Pacific Partnership, an agreement between the U.S., Mexico and 10 other Pacific Rim countries negotiated by the Obama administration and thrown out by Trump.

In a May 18 letter, newly appointed U.S. Trade Representative Robert Lighthizer told Congress that Trump plans to initiate negotiations with Canada and Mexico regarding NAFTA within 90 days. "Without this trade agreement and the market access it provides, the United States would stand to lose almost $2 billion annually in dairy exports and tens of thousands of farming and manufacturing jobs in communities across the country", said Michael Dykes, D.V.M., IDFA president and CEO. That's why the public and Members of Congress must hold him accountable and demand that the Administration renegotiate NAFTA in a way that protects American workers and raises wages.

That combative posture was underscored when the Commerce Department followed the news with the announcement of a new trade investigation against aircraft produced by Nafta partner Canada, saying it received unfair subsidies.

As the process of updating and renegotiating NAFTA proceeds, the US cotton industry "urges the administration to stay involved in this important trade agreement and not weaken current provisions", he said. "President Trump is going to change that".

Those comments were echoed by a number of farm groups ranging from the nation's largest American Farm Bureau Federation to a new organization called the Food and Agriculture Dialogue for Trade.

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"The objections to NAFTA are really about labor market adjustment problems more broadly", said Dr. Robertson.

Canada's Foreign Affairs Minister Chrystia Freeland, who met Mr Lighthizer on Tuesday and meets her Mexican counterpart in Mexico City next week, also said the negotiations must be among the three nations. Mexico and Canada are two of our largest export markets for the commodities and products raised on USA farms and ranches. The dairy groups have also continued to call for improving market access to Canada and tackling that country's expanding list of protectionist policies and other barriers to USA dairy exports. "You would strand a lot of USA company investments".

"With this first step, I now encourage the administration to swiftly commence modernization negotiations with our NAFTA partners and prioritize their quick conclusion", said Tom Vilsack, president and CEO of USDEC. "At the same time, numerous opportunities exist to shore up open trade and further deepen it with our NAFTA partners, such as addressing Canada's tariff and nontariff constraints on dairy trade, instituting stronger SPS commitments and ensuring that geographical indications are not used to restrict the use of common names". The administration will measure success in terms of its ability to stop USA companies from building plants in Mexico, and reducing the $62-billion deficit with that nation, he said.

TK: The main objective of the Trump renegotiation of NAFTA should be to do no harm to ag exports. "The negotiations will be tough, and we will go after the things that we want".

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