Ag Policy Blog

100 Days: A Trade Update on NAFTA, South Korea and Japan

Jerry Hagstrom
By  Jerry Hagstrom , DTN Political Correspondent
Perdue's Role on NAFTA Turnaround

Agriculture Secretary Sonny Perdue’s role in convincing President Donald Trump not to announce that he would sign papers beginning the process of withdrawing from the North American Free Trade Agreement has won the new secretary rare national media attention for someone in his position, especially someone who assumed office only a day earlier.

The Washington Post and The Wall Street Journal both reported that Perdue brought into the Oval Office a map of states that would be affected by withdrawing from NAFTA, and pointed out that these border and rural states had voted for Trump.

The reports said Perdue and Commerce Secretary Wilbur Ross worked to convince Trump not to move forward with a plan to make the announcement on Saturday, which will be his 100th day in office.

The Post went so far as to say that Perdue and Ross had convinced Trump not to begin the withdrawal before Trump spoke with the leaders of Mexico and Canada, and gave them credit for changing the president’s mind.

“Donald Trump said yesterday morning that his phone calls with the president of Mexico and the prime minister of Canada persuaded him to not withdraw from NAFTA. In fact, he had already made up his mind to stick with the agreement before either conversation,” James Hohmann wrote in the Post’s “Daily 202” briefing this morning.

Trump told the Post in an interview that Perdue’s map “shows that I do have a very big farmer base, which is good. They like Trump, but I like them, and I’m going to help them.”

Perdue portrayed Trump’s statements about withdrawing from NAFTA as a negotiating tactic, The Kansas City Star reported in a story based on a news conference Perdue held on a visit to Kansas City on Thursday.

Pushing on South Korea

President Trump as shifted his attention away from Canada and Mexico back to the Korean peninsula, but this time South Korea.

After threatening on Wednesday to withdraw from the North American Free Trade Agreement, the president said now that the U.S.-Korea Free Trade Agreement is "a horrible deal" that should also be terminated.

A review period is coming up for the agreement, which was negotiated under President George W. Bush and went into effect under President Obama.

"We've told them that we'll either terminate or negotiate," Trump told the Washington Post. We may terminate."

The U.S. had a $27.7 billion trade deficit with South Korea last year. At the same time, South Korea also bought about $6.2 billion in agricultural and food products.…

Japan: No Ag Concession in Bilateral

Taro Aso, Japan's deputy prime minister, said Japan will not make concessions on agriculture in a bilateral trade negotiation with the United States, The Nikkei reported, according to Washington Trade Daily.

“We can’t make any concessions,” Aso said.

This raises doubts about lower tariffs for U.S. beef, a major element of the Trans-Pacific Partnership that was lost for beef producers when the president withdrew from that trade pact.

Washington “probably assumes that a free trade agreement would be more beneficial than the TPP,” Aso explained. If the U.S. realizes that the terms of any bilateral deal will be less favorable than what the country would get with the wider agreement, “it certainly could decide that the TPP would be better after all,” he said.

Japan remains confident that the U.S. still might rejoin the Trans-Pacific Partnership, according to the report. An 11-member TPP excluding the U.S. could be implemented quickly, Aso told The Nikkei on Thursday.

“Since we went to the trouble of spending three years” negotiating the trade partnership, it should get ratified, Aso said, adding that there is no possibility of renegotiation.

Aso, who also serves as finance minister, called an American return to the trade pact a “realistic” scenario even though Vice President Mike Pence declared the TPP “a thing of the past for the United States of America” in a joint news conference with Aso after this month’s Japan-U.S. economic dialogue.

DTN Ag Policy Editor Chris Clayton contributed to this report.


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