WASHINGTON, April 26 (Reuters) – 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 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.
See more on President Trump:
Sen. Elizabeth Warren (D-MA) – In her new book, Warren reveals for the first time that she considered running in 2016, when liberals were begging her to enter the race. This year, Warren joined the Armed Services Committee, filling a major national security gap in her resume. First though, she’ll have to win reelection next year in Massachusetts, where some Warren allies expect Republicans to spend heavily to defeat or at least damage her.
Sen. Cory Booker (D-NJ) – Booker is a crowd favorite whenever he speaks to Democratic audiences and is expected to headline several party fundraising events this year. One of the few African-Americans in the Senate, Booker has a big social media following and is a darling of the Manhattan donor class. His precedent-breaking testimony against Attorney General Jeff Sessions was a high-profile event that endeared him to many on the left.
Sen. Bernie Sanders (I-VT) – Sanders won millions of votes during his unexpectedly strong presidential primary bid last year, which gave him a massive following and small-dollar donor base that’s the envy of many Dems. He’s the most popular politician in America, according to some surveys, and inspires enthusiastic loyalty. But Sanders would be 78 in 2020, and while his age doesn’t seem to slow him down, Democrats may want a fresher face.
Former Gov. Martin O’Malley (MD) – No one has shown more interest in 2020 so far than O’Malley, who has been traveling to key states to campaign for Democrats and who told NBC News in January that he “just might” run for president again. O’Malley failed to crack 1% in the Iowa caucuses last time around. But he was convinced there no room for anyone in a race so clearly defined by Hillary Clinton and Sanders, and insists that he could perform better under different circumstances.
NICHOLAS KAMM/AFP/Getty Images
Sen. Al Franken (D-MN) – With a reality TV star-turned-politician in the White House, some Democrats think the comedian-turned-politician would be the perfect foil. His book out next month, sarcastically titled, “Al Franken, Giant of the Senate,” could be a signal of higher ambition.
MANDEL NGAN/AFP/Getty Images
Joe Biden – The former vice president ran for the top job twice and nearly did a third time in 2016. Could he really make a go of it in 2020? “Never say never,” Biden told “Late Show” host Stephen Colbert. “You don’t know what’s going to happen. I mean, hell Donald Trump’s gonna be 74. I’ll be 77 and in better shape. I mean, what the hell?”
Photo by Brad Barket/WireImage
Sen. Kirsten Gillibrand (D-NY) – Gillibrand has long been seen as potential presidential material, and her decision to vote against almost every one of Trump’s Cabinet nominees has earned her renewed praise on the left. A recent profile in New York magazine further edged her toward the national stage.
Photo By Bill Clark/CQ Roll Call
Gov. Andrew Cuomo (NY) – Cuomo has built record of accomplishments in his time leading New York State, including the recent passage of a universal college tuition program, even though he’s also racked up some detractors along the way. And unlike some of the other 2020 possibles, he’s hardly shown a relish for taking on Trump.
Photo by Brad Barket/WireImage
Sen. Kamala Harris (D-CA) – The former California Attorney General just got to the Senate in January, but many party insiders think she’s interested in higher office and that she would be a formidable candidate for the White House. Political talent scouts have been watching her for years, with a 2015 Washington Post headline asking, “Is Kamala Harris the next Barack Obama?”
Photo by Zach Gibson/Getty Images
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.
The White House had been considering an executive order exiting NAFTA as early as Trump’s 100th day in office on Saturday, but there was a split among his top advisers over whether to take the step.
During his election campaign Trump threatened to renegotiate NAFTA and in the past week complained bitterly about Canadian trade practices.
It was under an executive order signed by Trump on Jan. 23 that the United States pulled out of the sweeping Trans-Pacific Partnership trade deal.
News of the potential presidential action to withdraw from NAFTA earlier drove the Mexican and Canadian currencies lower.
NAFTA TRADE HAVOC
A disruption in trade between the three NAFTA partners could wreak havoc in the auto sector and other industries, hitting profits at companies that have benefited from zero-level tariffs and Mexico’s relatively low labor costs. It would also hit U.S. agricultural exports hard.
“To totally abandon that agreement means that those gains are lost,” said Paul Ferley, an economist at Royal Bank of Canada.
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.
Details about the draft executive order on NAFTA were not immediately available.
Trump has faced some setbacks since he took office in January, including a move by courts to block parts of his orders to limit immigration.
Withdrawing from NAFTA would enable him to say he delivered on one of his key campaign promises, but it could also hurt him in states that voted for him in the election.
“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.”
The first administration source told Reuters that there were diverging opinions within the U.S. government about how to proceed and it was possible that Trump could sign the executive order before the 100-day mark of his presidency.
The source noted that the administration wanted to tread carefully. “There is talk about what steps we can take to start the process of renegotiating or withdrawing from NAFTA,” this source said.
Mexico had expected to start NAFTA renegotiations in August but the possible executive order could add urgency to the timeline.
The Mexican government had no comment on the draft order. The country’s foreign minister said on Tuesday that Mexico would walk away from the negotiating table rather than accept a bad deal.
Trump recently ramped up his criticism of Canada and this week ordered 20 percent tariffs on imports of Canadian softwood lumber, setting a tense tone as the three countries prepared to renegotiate the pact.
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)