Canada Raises Alarm on Trump Leaving Nafta

President Trump & Zippy Duvall
    American Farm Bureau Federation

President Trump welcomes Canada's Prime Minister Justin Trudeau on October 11, 2017.

Trade relations between the two countries have taken a dramatic turn this week, with Canada escalating its trade spat with the U.S.by filing a World Trade Organization complaint over American duties against Canada and other countries.

Talks between Mexico, Canada and the USA to renegotiate the terms of the North American Free Trade Agreement began in August previous year and are still underway, although concerns have been expressed by the United States at the lack of progress. Nafta, the trade pact between the U.S., Canada and Mexico, is now being renegotiated with the latest round of talks scheduled for later this month in Montreal.

Canada sends about 75 percent of its exports to the United States.

Given the highly integrated nature of the North American economy, NAFTA's collapse would have major economic implications for all three countries.

The Canadian dollar fell 0.9 percent to C$1.2574 against the greenback at 3:05 p.m.in Toronto.

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Canadian officials say if Trump does announce a US withdrawal, it could be a negotiating tactic created to win concessions.

Mexico and Canada together represent almost one-third of total USA agricultural exports.

The head of the U.S. Chamber of Commerce said that economic gains made through tax cuts and the lifting of business regulations would be undone if the U.S. canceled trade deals, including NAFTA.

Mexican Economy Minister Ildefonso Guajardo has said that Mexico won't negotiate under duress and will leave the table if the US initiates the withdrawal process.

The next round of NAFTA talks - the sixth so far - will be held in Montreal from January 23 to 28.

Negotiations are due to wrap up at the end of March.