In the weeks immediately following the election, president-elect Donald Trump has repeated his campaign pledge to dismiss the North American Free Trade Agreement. The Agreement, which provides for tariff-free trade between the U.S., Canada, and Mexico has come under repeated attack by Trump over the past year.
What Is Trump Planning To Do?
Vox.com reports that: “…according to a memo drafted by the president-elect’s transition team and obtained by CNN Tuesday, Trump is preparing for a wholesale reevaluation and renegotiation of trade policy that could potentially upend economic relationships the United States has held for decades…The document lays out a 200-day plan governed by five major objectives: renegotiating or withdrawing from the North American Free Trade Agreement[.]”
A sitting U.S. President does have the power to withdraw from NAFTA without Congressional approval and may do so upon six months written notice to the other parties.
Political opinion on NAFTA withdrawal seems largely negative, with sources stating that cause a downturn in the American economy and an increase in the unemployment rate. While it is unclear exactly where this will end up, businesses and individuals whose income rely upon the lack of tariffs currently guaranteed by NAFTA may have only six months warning prior to what could be a radical financial shift in the economic landscape.