President Donald Trump met with the prime ministers of two major U.S. trading partners over the weekend and early this week, emphasizing his commitment to enhancing bilateral trade relations with other countries, as opposed to large, multi-lateral agreements.
In a joint White House news conference on Feb. 10, Trump and Japanese Prime Minister Shinzo Abe stressed the importance of improving trade between the two countries. Before hosting Abe over the weekend at his Mar-a-Lago resort in Florida, Trump said he “will seek a trading relationship that is free, fair and reciprocal, benefiting both our countries”
After withdrawing last month from the Trans-Pacific Partnership (TPP) – a historically expansive trade agreement the agricultural industry largely supported – Trump emphasized his preference for pursuing bilateral agreements. Japan was one of 12 countries that signed the TPP.
After his weekend with Abe, Trump met with Canadian Prime Minister Justin Trudeau on Monday. Both leaders pledged to improve relations under the North American Free Trade Agreement (NAFTA), the 23-year-old trade deal between the United States, Mexico and Canada, noting they are for the most part pleased with current relations.
“We have a very outstanding trade relationship with Canada,” Trump said at a news conference at the White House. “We’ll be tweaking it. We’ll be doing certain things that are going to benefit both our countries.”
Their joint statement noted that Canada is the most important foreign market for 35 U.S. States, and more than $2 billion in two-way trade flows across the shared border every day.
While neither the joint statement nor remarks at the press conference directly referenced the U.S. dairy industry’s grievances with Canada’s trade barriers, House Speaker Paul Ryan, R-Wisc., said he raised concerns about access to Canada’s dairy market in his Monday meeting with Trudeau.
Ryan said he “re-emphasized the importance of breaking down trade barriers and improving market access for America’s dairy farmers.” According to the U.S. Dairy Export Council, Ontario milk pricing policies have blocked $150 million of U.S. exports.
“Canada’s intentional and continued flouting of its trade obligations effectively blocks imports of U.S. ultra-filtered milk,” said Michael Dykes, president of the International Dairy Foods Association in a statement. “What’s more, existing Canadian tariffs that range from 200 percent to more than 300 percent on other U.S. dairy products are unacceptable.”
During his early days as president, Trump has pledged to renegotiate NAFTA, which he called “the worst trade deal in history.”
During his meeting with Trudeau, Trump indicated he is most concerned about NAFTA’s approach to trade between the U.S. and Mexico.
“It’s a much less severe situation than what’s taken place on the southern border,” he said. “On the southern border, for many, many years the transaction was not fair to the United States. It was an extremely unfair transaction.”
Meanwhile, Mexico Sen. Armando Rios Piter, a member of the country’s center-left party, introduced a bill on Monday that would force his country to start buying higher-priced corn from Argentina and Brazil rather than the United States. Mexico is the United States’ second largest customer for corn, behind Japan.
In a letter to President Trump regarding his efforts to modernize NAFTA, the NGFA noted that in the 20 years since NAFTA was implemented, the market integration it fostered helped quadruple the value of U.S. food and agricultural exports to Canada and Mexico. View this letter and NGFA’s other trade priorities online.
TPP without the U.S.
Countries that remain signatories to the Trans-Pacific Partnership trade agreement are being invited to meet in mid-March in Chile to discuss next steps.
The meeting is being organized by Chile and other members of the Latin America trade bloc known as the Pacific Alliance, whose members include Chile, Colombia, Mexico and Peru whose purpose is to advance free trade and regional economic integration, with a particular focus on Asia.
The Pacific Alliance also has nearly 50 observer states, including Japan, China, Germany, France, the United Kingdom and the United States. It also is known that Mexico has begun exploring trade ties with Argentina and Brazil, as well as strengthening trade with the European Union.