U.S. President Donald Trump told the leaders of Canada and Mexico on Wednesday that he will not terminate the NAFTA treaty at this stage, but will move quickly to begin renegotiating it with them, a White House statement said.
The announcement came after White House officials disclosed that Trump and his advisers had been considering issuing an executive order to withdraw the United States from the trade pact with Canada and Mexico, one of the world's biggest trading blocs.
The White House said Trump spoke by telephone with Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau and that he would hold back from a speedy termination of NAFTA, in what was described as a "pleasant and productive" conversation.
"President Trump agreed not to terminate NAFTA at this time and the leaders agreed to proceed swiftly, according to their required internal procedures, to enable the renegotiation of the NAFTA deal to the benefit of all three countries," a White House statement said.
"It is my privilege to bring NAFTA up to date through renegotiation. It is an honor to deal with both President Peña Nieto and Prime Minister Trudeau, and I believe that the end result will make all three countries stronger and better," Trump was quoted as saying in the statement.
“The North American Free Trade Agreement has been a tremendous success for the U.S. pork industry, which has seen an explosion in exports to Canada and Mexico since the deal was implemented in 1994,” Ken Maschhoff, president of the National Pork Producers Council said. “In fact, Mexico and Canada are now our No. 2 and No. 4 markets, so we absolutely must not have any disruptions to U.S. pork exports there. Even a short-term interruption in our exports would have a significant negative economic impact on U.S. pork producers.”
He added that the U.S. pork industry was “all for modernizing NAFTA, but we cannot support efforts that would undermine the livelihoods of America’s 60,000 pork producers.”
The Mexican and Canadian currencies rebounded in Asian trading after Trump said the U.S. would stay in NAFTA for now. The U.S. dollar dropped 0.6 percent on its Canadian counterpart and 1 percent on the peso.
NAFTA Trade Havoc
Trump has repeatedly vowed to pull out from the 23-year-old trade pact if he is unable to renegotiate it with better terms for America. He has long accused Mexico of destroying U.S. jobs. The United States went from running a small trade surplus with Mexico in the early 1990s to a $63 billion deficit in 2016.
"Mr. President, America's corn farmers helped elect you,” the National Corn Growers Association said in a statement. "Withdrawing from NAFTA would be disastrous for American agriculture."
Canada said it was ready to come to talks on renewing NAFTA at any time.
"At this moment NAFTA negotiations have not started. Canada is ready to come to the table at any time," said Alex Lawrence, a spokesman for Canadian Foreign Minister Chrystia Freeland.
(Reporting by Steve Holland; Additional reporting by Fergal Smith in Toronto, David Ljunggren in Ottawa,; Rodrigo Campos in New York and Julie Ingwersen in Chicago; Writing by Jason Lange; Editing by Tom Brown, Bill Rigby and Michael Perry; additions by JoAnn Alumbaugh)