The Potential Effects of Renegotiation of NAFTA
The Potential Effects of Renegotiation of NAFTA

Author(s): Damian Wnukowski
Subject(s): Economic policy, International relations/trade, Geopolitics
Published by: PISM Polski Instytut Spraw Międzynarodowych
Keywords: trade; USA; Canada; economy; Free Trade Agreement; Mexico; North America
Summary/Abstract: In the U.S. presidential campaign, Donald Trump criticised NAFTA, calling it the “worst trade deal” the U.S. has ever signed. He decried the agreement as contributing to the high U.S. trade deficit with Mexico and loss of jobs to that country. In the first days of his presidency, Trump said his administration would renegotiate NAFTA to make it more beneficial to the U.S. Talks on this issue could take a while. Moreover, if the partners remain inflexible in their demands, withdrawal from NAFTA cannot be excluded. Its renegotiation may also have a negative impact on the world economy, partly by increasing uncertainty and limiting investment in NAFTA member states.

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