Trump’s NAFTA outline won’t help America’s debt with Mexico, says Amb. Kirk
Ambassador Ron Kirk on why NAFTA needs updating, why focusing on trade deficits can be misleading, and if NAFTA negotiations with Mexico should include talks of building the wall.
Former U.S. Trade Representative Ambassador Ron Kirk said the Trump administration needs to be cautious when renegotiating NAFTA and shouldn’t let America’s debt with Mexico be the catalyst for change.
“Those objects that the [Trump] administration outlined, many of them really won’t impact that deficit,” he told FOX Business’ Liz Claman.
Kirk used the automotive industry as an example of how the U.S. debt with Mexico can be misleading.
“A car that may start out being a symbol at our General Motors plant here in Arlington, Texas, may go to Mexico City for final finishing. That car is going to count as an import to the United States from Mexico. Whether 35 percent of the content of work or 75 percent of the content of work has been done in the United States.”
The former U.S. Trade Representative explained why there may be a “danger” in the Trump administration’s reasoning for renegotiating the North Atlantic Free Trade Agreement (NAFTA), based on whether the U.S. is in a surplus or negative.
“To make most of the advance technological goods that we make in this country now we have to import the raw materials for example to make that happen. That’s gonna give us a deficit with those countries. But we are then going to turn around and make products that we ship all around the world,” Kirk said.