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Trade analyst says trilateral NAFTA works best

A trade economist says a move to bilateral agreements between the three NAFTA countries would degrade the existing ecosystem that’s been benefiting the U.S., Canada, and Mexico for 20 years.

Earlier this month, White House economic adviser Larry Kudlow said President Trump is contemplating a shift in NAFTA negotiations, with a preference to negotiate with Canada and Mexico separately.

Speaking to Brownfield at a free trade luncheon in south-central Minnesota Wednesday, Tori Whiting with the Heritage Foundation says doing away with the current trilateral structure could have ramifications.

“In order to maintain the supply-chain that depend on having one set of rules between the three countries, we need to keep that idea intact.”

She says the focus of renegotiations should remain on lowering trade barriers, not eradicating a successful free trade agreement.

“Canadian dairy tariffs are a great example (of a trade barrier).  The U.S. has tariffs on Canadian lumber.  We also have subsidies on a lot of agricultural products.  So if we can sit down at the table and say we want you to get rid of this particular set of tariffs, here’s what we can give you.”

Whiting says while NAFTA has been a huge boon for the U.S. economy, the agreement does need to be modernized.