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The elephant in the room at the NAFTA talks

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The first round of long-awaited talks on modernizing NAFTA finished Sunday, with Canada, Mexico and the United States issuing a statement that they had made “detailed conceptual presentations” of their positions. Negotiators from the three countries will meet again in Mexico on September 1 to continue trying to revise the trade pact. But while all say they are keen to see a new deal emerge, they still have to navigate the political risks attached to any commercial agreement.

Donald Trump’s promise to renegotiate trade deals was a key plank of his “America First” campaign platform. One of his first acts in the White House was to withdraw the United States from the Trans-Pacific Partnership (TPP) with countries in Asia-Pacific and the Americas, including Australia, Canada, Chile, Japan, Malaysia, New Zealand, Peru, Singapore and Vietnam. Meanwhile, negotiations between Washington and the European Union for the Transatlantic Trade and Investment Partnership (TTIP) have not resumed since Barack Obama left office.

Speculation now centers on the future of the North American Free Trade Agreement, typically seen by many economists as at least a qualified success story. Since 1994, trade between the United States, Mexico and Canada has more than tripled, forming a trading bloc with a combined GDP of around 20 trillion dollars.

However, prominent representatives of both the left and right, from Bernie Sanders and Ralph Nader to Ross Perot and Pat Buchanan, have long criticized the agreement for contributing to a hollowing out of the country’s manufacturing industry and lost U.S. jobs, partly because of increased trade deficits with Mexico and........

© Japan Today