A Modern Major Free Trade Deal

Trade & Policy

A Modern Major Free Trade Deal

The North American Free Trade Agreement (NAFTA) is a big deal for North Dakota farmers and recent comments from President Donald Trump have made it clear that it is a deal he seeks to renegotiate-or possibly even terminate.

At a rally in Arizona, President Trump was reported as saying:

"Personally, I don't think we can make a deal, because we have been so badly taken advantage of. They have made such great deals, both of the countries, but in particular, Mexico, that I don't think we can make a deal. So I think we'll end up probably terminating NAFTA at some point, OK? Probably."

North Dakota Agriculture Commissioner Doug Goehring doesn't think there's crosshairs over NAFTA, despite the president's words. In a recent phone interview he said there are "things that need to be addressed" regarding the benefits the free trade agreement provides for North Dakotans. Modernizing NAFTA appears to be the root goal for critics and supporters. Daryl Lies, president of the North Dakota Farm Bureau, said he'd like to see a change built off the current infrastructure, and he detailed a few areas he thought needed to be changed. Goehring said manufacturing and labour issues are aspects of industry that NAFTA also deals with, and there's concern over whether regulations and taxes are forcing businesses and manufacturing out of the United States. "It was thought that regulations were forcing businesses out of the country, but when they start to look at the global situation and what happened in other countries ... lots of other countries welcome businesses, welcome the opportunity to put people to work, and they weren't taxing these places 28%, they were taxing them 10%," Goehring said. "If you're regulating the heck out of a business and you're taxing them to death, they pick up and move."

In terms of specific agricultural impact, Canada and Mexico have in place laws that keep out some US agricultural products. Another problem is tariffs, Goehring said, "They are recessive in nature in that they add more cost to the product going into another country. So if we're already competing with a higher dollar making our products more expensive to purchase, it doesn't help when they throw larger tariffs on American goods than our competitors."