New trade deal 'short on real impact' for Northland

The president says the United States-Mexico-Canada Agreement is a "wonderful" trade deal, a "historic transaction." But what does it do for the Northland?...

Canadian Prime Minister Justin Trudeau in Toronto on July 5, 2018. (Cole Burston / Bloomberg)

The president says the United States-Mexico-Canada Agreement is a "wonderful" trade deal, a "historic transaction." But what does it do for the Northland?

"From what I am reading, this agreement is long on rhetoric and short on real impact," said Tony Barrett, retired economics professor at the College of St. Scholastica. "Perhaps the biggest impact is removing a large source of uncertainty hanging over North American businesses. That certainty going forward will allow businesses to make investment decisions they may have been holding off on."

The replacement for the North American Free Trade Agreement was announced late Sunday after a deal was struck with Canada - Minnesota's largest trading partner - capping President Donald Trump's longtime threats to walk away from the 24-year-old compact. The U.S. and Mexico reached an agreement in August.

"I think it's a sigh of relief for Minnesota - we're a very competitive state. We're a state that doesn't have anything to fear from international trade," said Robert Kudrle, a professor and trade expert at the University of Minnesota Twin Cities. "If NAFTA had fallen apart, these are two huge trading partners. It would have really been disruptive."

Kudrle noted that while the new deal makes some changes, especially to the auto and dairy industries, it largely keeps the old framework in place.


"It's a situation where the president can declare a victory, but if NAFTA was as bad as he said it was, it hasn't changed much," Kudrle said.

To that point, Barrett said: "Specifically to our region, there will be no meaningful impact."

Congress will need to approve the deal before it goes into effect.

U.S. Rep. Rick Nolan had called NAFTA "a disaster for American workers and manufacturing companies," and on Monday tweeted his support for Canada's inclusion in the new deal.

"I will continue monitoring how it will be regulated to ensure labor protections are enforced," the retiring 8th District Democrat wrote Monday.

Brooks Johnson was an enterprise/investigative reporter and business columnist at the Duluth News Tribune from 2016 to 2019.
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