Trade Balances and the NAFTA Renegotiation

June 1, 2017

The Trump administration’s strategy toward trade agreements in general, and the North American Free Trade Agreement (NAFTA) in particular, is fundamentally misplaced for two reasons: (1) its apparent desire to use trade policy rather than macroeconomic policy including exchange rate policy to reduce trade imbalances and (2) its focus on the bilateral rather than global scope of those imbalances. Bergsten outlines the dangerous and self-defeating implications for the negotiation of such an unusual approach. Accordingly, provisions that could be included in the agreement to pursue that purpose are not likely to be feasible.

Read Full Material: Link


Topics: TRADE POLICY TRADE DEFICIT

Agreements: NORTH AMERICAN FREE TRADE AGREEMENT (NAFTA)

Regions: CANADA MEXICO UNITED STATES NORTH AMERICA

Authors: C. FRED BERGSTEN

Publishing Institution: PETERSON INSTITUTE FOR INTERNATIONAL ECONOMICS

RTA

Other Research

RTA

Trade and Integration Monitor 2017: Beyond the Recovery, Competing for Market Share in the Digital Era

November 15, 2017

The value of exports from Latin America and the Caribbean (LAC) started to recover in 2016, and increased a notable 13.2% year-on-year in the first half of 2017. The regional recovery, however, was... READ MORE

RTA

Going It Alone in the Asia-Pacific: Regional Trade Agreements Without the United States

October 5, 2017

The withdrawal of the United States from the Trans-Pacific Partnership (TPP) in early 2017 led the remaining 11 countries in that trade and investment agreement to explore alternative ways to susta... READ MORE