Revised NAFTA Deal Would Offer Modest Economic Benefits, Report Says
DAVID GREENE, HOST:
The big, new trade deal that President Trump signed with Mexico and Canada last fall will have at best a modest impact on the U.S. economy. This is according to a report released yesterday by an independent federal panel. And we can hear about it from NPR's Jim Zarroli.
JIM ZARROLI, BYLINE: President Trump came to office promising to do away with NAFTA, which he called the worst deal ever negotiated. And he vowed to replace it with something much better. The deal he unveiled last year was called the U.S.-Mexico-Canada Agreement, and Trump has made elaborate promises about its effects on growth.
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PRESIDENT DONALD TRUMP: The agreement will govern nearly 1.2 trillion in trade, which makes it the biggest trade deal in the United States' history.
ZARROLI: Yesterday, the International Trade Commission released a much-anticipated report saying the revised agreement would add about $68 billion to growth by the sixth year. In a $20 trillion economy, that amounts to about a third of 1 percent. The report also says 176,000 jobs would be created, in part because of new rules requiring cars sold in North America to have more locally made parts. But the new requirements would also drive up prices, resulting in fewer car sales. Lori Wallach is director of Global Trade Watch, which has been a big critic of trade agreements such as NAFTA.
LORI WALLACH: The tiny projected gains found in this assessment contradict Trump's grandiose claims that the revised NAFTA will lead to, he said, cash and jobs pouring into the U.S.
ZARROLI: The Trump administration issued its own report taking issue with the conclusions. It said the commission's report greatly understates the benefits of Trump's deal. The report could have an impact on Congress, which has to approve the new deal. Many Democrats have been unhappy with big trade agreements and what they see as their lack of worker and environmental protections. If the economic impact of the Trump agreement is relatively modest, they have more leeway to try to make changes. That could drag out debate over the deal.
Jim Zarroli, NPR News, New York. Transcript provided by NPR, Copyright NPR.