According to reports from today’s cabinet meeting in Washington, Donald Trump has claimed that the United States is getting closer to coming to a trade agreement with Mexico. This comes alongside statements that the Mexican President-elect (AMLO) and his American counterpart are building a good rapport, journalists were recently told in Washington.
Since the announcement, the Mexican Peso has also risen in value in comparison to the market yesterday.
The issue, which America, Mexico and Canada are jointly invested in, relates to the contested North American Free Trade (NAFTA) Deal. The aim of the agreement was to make trade easier between the three countries through a secure trading bloc. The immediate response to the agreement, which was signed in 1994, saw vast rebellion from Mexico’s poorer states as a result of the Zapatista movement and has recently been a topic of renegotiation for Trump.
There are both benefits and setbacks to the current deal, for instance, Mexican agricultural exports have grown and manufacturing jobs in Mexico have also seen an increase. According to a number of reports, however, American workers have lost jobs in recent years as companies moved to Mexico and although the amount is not high enough to lay blame specifically on the NAFTA deal, Donald Trump hopes a renegotiation will contribute to his ‘America First’ campaign policies.
News that the countries are potentially set to smooth out the agreement was reinforced on Tuesday 17 when Mexican Ambassador to the U.S. Gerónimo Gutiérrez was quoted by Politico saying the NAFTA negotiation can be “wrapped up by the end of the year.” At this point, it is believed that a smooth transition will happen between the current Mexican administrative team working on the renegotiation, and the incoming AMLO government.
As well as saying that the friendship with Lopez Obrador is ‘‘doing great,’’ according to Trump, there are further suggestions within the American administration that the NAFTA deal could be broken into two separate deals for Canada and Mexico, with the latter in the running to secure the first deal. Although the only speculation at this point, should Trump’s comments come to fruition about separate deals, NAFTA’s survival will certainly be thrown up in the air.