Trump agrees to renegotiate NAFTA with Mexico, Canada

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In phone calls Wednesday to Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau, the White House said, Trump "agreed not to terminate NAFTA at this time".

The mere rumour of it happening this week, floated by the White House, shaved nearly two per cent off the Mexican peso and a third of a cent off the loonie, while businessmen and lawmakers were up in arms.

"And what that does for the American workers is it hurts us because we are not producing as much goods as these other countries", said Smith, president of United Steelworkers Local 420A.

"If we do not reach a fair deal for all, we will then terminate NAFTA", Trump tweeted Thursday.

"I was all set to terminate", Trump said in an interview.

White House spokesman Sean Spicer said that while Trump is open to renegotiation, he is serious about a possible exit from the trade deal. Let's see if we can make it a fair deal because NAFTA has been a terrible deal for the United States.

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Mexico's peso and Canada's dollar fell against the US dollar, with the peso shedding about 1.5 percent in just over an hour, while Canada's "loonie" lost about 0.45 percent.

His comments came at the end of a long 24 hours during which Ottawa and Mexico City were whipsawed over the Trump administration's intentions over the 23-year-old trade pact.

Another recent example of this phenomenon comes in regard Chinese President Xi Jinping, with whom Trump spent two days at Mar-a-Lago earlier this month.

But the person, along with an administration official, who both spoke on the condition of anonymity in order to discuss internal deliberations, had said a number of options remained on the table, and stressed discussions are ongoing about the best way to proceed.

That lever was brandished this week when stories started appearing in the Washington Post, Politico, CNN, and the New York Times that sources within the White House were really, seriously, considering a draft executive order to cancel NAFTA.

"I'm happy to engage with the president regularly", Trudeau said Thursday.

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The move, which one source said might come as soon as Trump's 100th day in office on Saturday, could unravel one of the world's biggest trading blocs.

Trump's order would not have immediately terminated NAFTA.

Donald Trump loves to boast about his excellent negotiating skills, claiming that he's the best of the best, but yet again could not complete a campaign promise. And it is unclear what would happen next.

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. On Tuesday, his administration ordered tariffs on imports of Canadian softwood lumber in retaliation for what it said was unfair treatment of U.S. dairy farmers. The Canadian dollar also fell, though not as sharply.

Trump zeroed in on the renegotiation of trade deals since his presidential campaign and, in his very early days in office, withdrew the USA from the Trans-Pacific Partnership. He expressed that, yes, he was very much thinking about cancelling. The United States went from running a small goods trade surplus with Mexico in the early 1990s to a US$63-billion (RM274 billion) deficit in 2016.

Mr Trudeau said he had warned Mr Trump of the disruption that pulling out of NAFTA would cause, while Mexico's Foreign Minister added that a good outcome for all three countries was possible under a new accord. But that official said NAFTA has been a top priority for the president since Day One and said the administration has been working on it since taking office.

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