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No fallout for Caribbean in new US trade deal, says expert

Published: 
Thursday, August 30, 2018

The renegotiation of the North American Free Trade Agreement (NAFTA) should not have any major impact on T&T and the Caribbean said Dr Anthony Gonsalves, Honorary Senior Fellow, Institute of International Relations, University of the West Indies (UWI).

“It is essentially a free trade agreement between those three countries, United States, Canada and Mexico. They are just negotiating certain terms and conditions in certain sections of the agreement in the areas that the Americans think they have problems like the auto industry and the question of labour conditions. The Americans think that they are losing jobs because the labour conditions are not strict enough in Mexico,” he told Guardian Media by phone yesterday.

The White House is finalising details of a new free trade deal with Mexico to replace the North American Free Trade Agreement — with or without Canada.

Scrapping NAFTA was one of US President Donald Trump’s central promises during his presidential campaign. He blamed the 24-year-old trade pact for decimating the US manufacturing industry and the loss of thousands of factory jobs.

Gonsalves said the only area where T&T might be remotely affected is in the area of steel.

NuIron Ltd manufactures direct reduced metal in T&T for its parent company NuCor Inc headquartered in North Carolina, United States.

“Some of the American steel giants have been behind Trump on raising steel tariffs. NuCor still produces steel in T&T and is based in the United States. T&T has duty-free access to the US market I believe under the Caribbean Basin

Initiative (CBI) trade agreement with the United States. So far, Trump has not said anything about these non-reciprocal arrangements. I see that NuCor has put in a bid for a steel mill here. They were the ones who pushed Trump to raise the tariffs as they felt that their plants were in trouble in the United States. I am not sure that would be beneficial to T&T. The rise in the price in steel could make us a little more competitive in the steel market.”

He said that T&T has to be “vigilant” and observe what is taking place internationally especially with regard to American trade deals.

“Trump has not paid any attention to Latin America and the Caribbean. He has ignored us and maybe that is a good thing. The less said about us is probably the better because he is unpredictable. The CBI is not a legal agreement and Trump could wake up tomorrow and cancel the whole agreement or change the tariff on something. It is different with NAFTA as he has to go to Congress to change that,” he said.

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