Commerce Secretary Wilbur Ross on Sunday said the Trump administration is still determining what to replace the North American Free Trade Agreement with following the president’s campaign promises to rescind the deal.
The agreement was forged in 1994 between the U.S., Canada and Mexico. Ross said his department is focused on updating “outdated” parts of the deal that have since gone “wrong.”
“One size doesn’t fit all,” Ross said during an interview on Fox News’ “Sunday Morning Futures.” “The issues of automotive are not the same as the issues of agriculture; they’re not the same as the issues of electronics, or steel. It’s a very, very complicated situation. So it’s very hard to paint just with one big broad brush.”
Among the “imperfections” that Ross said need fixing are rules that limited the country of origin rules to a certain percentage of individual automotive parts. One goal of the new agreement will be reducing America’s balance of payments deficit while increasing total trade, Ross explained.
The administration is also said to be looking at introducing a border adjustable tax, which would tax imports on neighbors’ goods. The move could increase the cost of items Americans have not had to pay more for because of the free trade agreement. One study by the National Retail Foundation suggests the average U.S. family would pay an additional $1,700 if the border tax is implemented.
Ross did not confirm the White House’s plans to impose a border tax, but did say they are looking at “substance rather than form” when it comes to reforms.
“The more important thing than the exact date is to get it right. And one of the dangers in multilateral negotiations because they are so complex, is people get too invested in making a deal as opposed to making the deal. We’re not going to fall into that trap,” Ross said.
