Trump announces 'incredible' trade deal with Mexico

Trump announces 'incredible' trade deal with Mexico

Trump announces 'incredible' trade deal with Mexico

U.S. President Donald Trump talks via speakerphone with Mexican President Enrique Pena Nieto as they announce a bilateral deal to replace the North American Free Trade Agreement (NAFTA) at the White House in Washington, U.S., August 27, 2018.

But compared to the more dire possibilities-that Mr. Trump would pull the US out of Nafta or, lacking congressional approval of that, impose high tariffs on Mexican and Canadian goods that would render the agreement obsolete-the possibility of renegotiation counts as a relief.

"Progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement", he said.

Mexican President Enrique Pena Nieto has urged Canada to rejoin the talks.

The deal between the US and Mexico is expected to include several changes the Trump administration believes will help to wrest some vehicle and car-parts manufacturing back to the USA from Mexico and from overseas.

However, the president affirmed negotiations with Canada will begin "very shortly".

President Donald Trump had pulled the U.S. out of the NAFTA pact claiming it was unfair to Americans. The announcement of a U.S. -Mexico agreement lifted financial markets.

Trade negotiations with Canada are still ongoing.

Foreign Affairs Minister Chrystia Freeland is cutting short a diplomatic trip to Europe to re-enter the high-level talks in Washington on Tuesday.

Senior administration officials also made clear on a call with reporters Monday afternoon that they were still pursuing a revised NAFTA trade agreement, though they maintained the possibility of a bilateral deal between the United States and Mexico if a trilateral deal with Canada can not be reached.

Trump strongly campaigned on the issue of repealing or completely redoing NAFTA, a trade deal he argues was "terrible" for the United States and destroyed manufacturing in states across the country.

The United States and Mexico have reached a preliminary agreement resolving key bilateral trade issues.

Austen said the Canadians had been regular contact with the NAFTA negotiators.

The president said that he will be calling Canadian Prime Minister Justin Trudeau.

"We are starting negotiations with Canada pretty much immediately", Trump said.

Still, an accord between the USA and Mexico is the biggest development in talks that began a year ago, punctuated by Trump's repeated threats to quit altogether.

"While higher trade barriers would shield some domestic industries from import competition, the resulting wage gains would be more than offset by the detrimental effects of reduced exportopportunities and the increased costs of imported inputs for manufacturing firms", wrote BIS senior economist, and the report's lead author, Raphael Auer.

On Monday morning, he tweeted that a deal would be coming today, and then later the administration set a time for that announcement.

But pressed as to whether Mexico is willing to enter a bilateral deal with the U.S., a senior White House official on the same call dodged.

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