The White House has announced that the United States will not unilaterally withdraw from Nafta, the landmark free trade agreement with Canada and Mexico, after multiple reports that Donald Trump was planning to pull out of the deal.
In a readout of calls between Trump, Canadian prime minister Justin Trudeau and Mexican president Enrique Pena Nieto on Wednesday, the White House said: “President Trump agreed not to terminate Nafta at this time.”
However, the statement added “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”.
The news came after reports on Wednesday that Trump was planning to sign an executive order that would trigger the process for the United States to withdraw from the deal, which was negotiated by the George HW Bush and enacted by Bill Clinton in 1994. The US would have to give six months’ notice to withdraw from the free trade agreement and the executive order would start the clock in what the White House viewed as a negotiating tactic to force more favourable terms for renegotiation from Canada and Mexico. However, a White House official told the Guardian on Wednesday that the situation was “more complicated” than reported.
On Thursday Trump characterized the discussion with Pena Nieto and Trudeau as a request from the two leaders for him not to pull out of the trade pact. “I received calls from the President of Mexico and the Prime Minister of Canada asking to renegotiate NAFTA rather than terminate,” the president wrote on Twitter. “I agreed … subject to the fact that if we do not reach a fair deal for all, we will then terminate NAFTA. Relationships are good – deal very possible!”
One of Trump’s key themes during his presidential campaign was his scepticism of free trade, in particular, the “bad deals” which he believed the United States had negotiated with other countries. Nafta had long come under particular scorn from Trump. In an interview last week with the Associated Press, Trump described the pact as “a catastrophic trade deal for the United States” and said “I am going to either renegotiate it or I am going to terminate it.”
Trump has had recent tensions with America’s neighbours. Mexican foreign minister Luis Videgaray slammed Trump’s plans for a border wall between the United States and Mexico as “a hostile act” on Tuesday and insisted yet again, contrary to Trump’s campaign promises, that Mexico would not pay for the wall. With Canada, Trump announced a new tariff on softwood lumber on Tuesday that triggered concerns of a potential trade war between the two countries. He warned that “people don’t realise Canada’s been very rough on the United States … they’ve outsmarted our politicians for years”.
The initial reports that Trump was considering pulling out of the trade agreement brought a horrified reaction from a number of top Republicans.
John McCain tweeted that “Withdrawing from #NAFTA would be a disaster for #Arizona jobs & economy – @POTUS shouldn’t abandon this vital trade agreement”. Senator Ben Sasse of Nebraska issued a statement saying “scrapping Nafta would be a disastrously bad idea”.