WASHINGTON – A published report says President Donald Trump planned to give Canada and Mexico five days notice that the U.S. intended to leave the North American Free Trade Agreement.
The Financial Times says it received a leaked draft executive order that Trump had originally planned to sign on Saturday before back-tracking and agreeing to renegotiate the trade pact.
A copy of the draft order posted online by the Financial Times says Canada has “continued to exploit the American dairy and lumber industries.”
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The document blames NAFTA for a “massive transfer of wealth” from the United States, the loss of 700,000 jobs and a more than $1-trillion trade deficit with Mexico since the agreement was enacted in 1993.
It also states NAFTA is responsible for “waves” of illegal immigration and the closure of “tens of thousands of factories and manufacturing establishments” in the U.S.
On Thursday, Trump insisted he wasn’t bluffing about threatening to pull out of NAFTA, but said he had a change of heart during phone calls with Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto.
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“I like both of these gentlemen very much,” Trump said.
“I respect their countries very much. The relationship is very special. And I said, I will hold on the termination; let’s see if we can make it a fair deal.”
He also hinted that economic disruption was another reason for not announcing a U.S. pullout from NAFTA.
The mere rumour of it happening this week, floated on Wednesday by the White House, shaved almost two per cent off the Mexican peso and a third of a cent off the loonie.
The leaked draft executive order sets a high bar for trade agreements, saying they must “increase America’s economic growth, decrease America’s trade deficit, raise American wages, maintain the integrity of America’s borders, and strengthen the manufacturing and defence industrial bases of the United States.”
NAFTA “has not met any of these conditions,” it states.