President Trump, who has called the North American Free Trade Agreement “the worst trade deal” ever signed by the United States, appears to have backed off his threat to abandon the deal and is instead proposing keeping major planks in place when he begins renegotiating it later this year.
But Mr. Trump, eager to showcase his tough stance against unfair trade practices, plans to sign two executive orders on Friday that will lay the groundwork for new policies and stricter enforcement of trade laws.
The president will order a 90-day study of abusive trade practices that contribute to the United States’ trade deficit. The Commerce Department and the United States trade representative will do a country-by-country, product-by-product accounting of the reasons for the imbalance. A second directive is aimed at increasing the collection of duties from countries whose companies American officials believe are selling products in the United States below their cost of production.
Neither measure will have an immediate impact on trade policy or enforcement, but each could eventually lead to aggressive new measures. Both are aimed at showcasing Mr. Trump’s intent to fulfill his promises on trade.
“These actions are designed to let the world know that this is another step in the president fulfilling his campaign promise,” said Wilbur L. Ross, the secretary of commerce. He said the findings would “form the basis for decision-making by the administration” on how to approach trade deficits in the future, including a renegotiation of Nafta.
“For the first time, we’re looking comprehensively at the source of what has been a large and persistent trade deficit that has contributed to job losses, the loss of our manufacturing base and other things,” said Peter Navarro, the director of Mr. Trump’s National Trade Council.
The president is poised to give Congress the legally required 90 days’ notice of his intention to renegotiate Nafta, the 1994 pact with Canada and Mexico. In a draft letter circulated among members of Congress this week, the administration proposed adding a provision to allow tariffs to be reinstated if a flood of imports threatens to harm a domestic industry.
Mr. Trump also wants to adjust the agreement’s rules of origin, or how much of a product must be made in a Nafta country. And he wants Nafta partners to expand the market for United States-made goods in their government procurement.
Information credit: Newyork times/bloomberg