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David Sparks Ph.d NAFTA and Tariffs
by David Sparks Ph.d, click here for bio

Program: Line on Agriculture
Date: March 12, 2018

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President Donald Trump’s latest announcement over steel and aluminum tariffs comes right in the middle of Nafta talks and the announcement is overshadowing efforts by US negotiators and representatives from the biggest export markets to update the nation's most important free-trade agreement.

After days of speculation, Trump announced Thursday he wants to slap a 25-percent tariff on steel imports and 10 percent on aluminum imports. Specifics are still are unclear, including what countries may still be exempt, but the implications rippled through the seventh round of talks on the North American Free Trade Agreement in Mexico City.

Canada is ready to fire back with the toughest language against the Trump administration since Nafta talks started last year. Also, a person familiar with Mexico’s position said the nation plans to do the same. Canada is the top provider of both U.S. steel and aluminum imports, while Mexico is the fourth-biggest steel provider. Numerous industry groups condemned the tariff move and warned it could start a trade war.

 Nafta has been good for America’s farmers and ranchers and the numbers show that fact. Before the agreement took effect, America sold $8.9 billion a year in agriculture goods to both Canada and Mexico. Now, exports have increased to $39 billion last year alone.

American Farm Bureau Federation Senior Director of Congressional Relations, Dave Salmonsen, says agriculture has a lot to look forward to with a modernized NAFTA, as the trade agreement’s negotiations continue in Mexico City this week.

“Probably the one most positive thing for U.S. agriculture is what’s called the sanitary and phytosanitary chapter, that’s the area that deals with food safety rules, trying to get better accommodation between the three countries, make sure we have science-based rulemaking, equivalency among regulations in some ways, so that there aren’t these behind the border barriers that hold up trade.

Besides food safety, Salmonsen explains that many other topics important to agriculture are up for discussion.

“Dairy and poultry barriers to trade with Canada protecting their supply management system. They’ll be talking about biotech approvals, we’re trying to get that equal in all three countries so products can flow freely. Those are the things that are on the schedule,” said Salmonsen.

With negotiations underway, Salmonsen says it is important to remember that NAFTA is paramount to the success of not only U.S. agriculture, but other industries and future trade partnerships.

“Keep the negotiations moving forward. There’s been so much activity, and continuing activity, on all the efforts to make sure people understand here in Washington and around the country, how important NAFTA is, not just to agriculture but to other industry sectors, to our trading partners, and to our trade stance around the world,” said Salmonsen.

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