Trade Experts Expect to See a 'Zombie' NAFTA

Prime Minister Justin Trudeau says the Liberal approach to renegotiating NAFTA is 'delivering fruit.' He made the remarks at a news conference to close a Liberal cabinet retreat in London Ont. on Friday

A string of calming comments from Donald Trump about NAFTA has trade proponents across the continent breathing some relief that the US president's trigger finger may not be about to blow up the deal after all.

Canada has so far largely shunned confrontation with Washington, stressing instead the merits of NAFTA and free trade as Canadian Prime Minister Justin Trudeau makes efforts to forge closer ties with Trump.

The two other sources, who are involved in the trade talks and asked not to be named, said that Mexico remains firm on its position to get up and leave from the negotiating table if Trump goes through with the move.

US Commerce Secretary Wilbur Ross (left) holds a news conference with Mexico's Secretary of Economy Ildefonso Guajardo Villarreal at the Department of Commerce in Washington, March 10, 2017.

Trump made more-muted-than-usual remarks to a farm-lobby conference last week regarding NAFTA.

"I think Canadians understand that while we have a very good relationship with our largest trading partner, it's just the smart thing to do". But even if President Donald Trump serves notice of a pullout, the trade deal could survive.

Trump has long called the 1994 treaty a bad deal that hurts American workers. "I think all of us are mindful of the Mexican elections". Some stocks tumbled Wednesday following reports that confirmed Canada is taking the threat seriously.

Trump's proudest boast is the performance of the S&P 500 and the Dow Jones index since he became president.

The Trudeau government appears to have adopted a good-cop, bad-cop strategy for saving NAFTA - coming up with some "creative" new proposals in response to unpalatable US demands while simultaneously signalling its willingness to aggressively attack what it considers unfair American trade practices.

Scrapping NAFTA would not only damage GOP campaign plans, but it would also be likely to set off a fierce legal battle over whether or not Trump has the unilateral authority to make the decision without congressional approval.

But the clock is ticking for trade negotiators to reach a deal before political pressures posed by impending elections in Mexico and the United States poison the talks. Authorities said that in considering the mockups - built by six companies from across the United States - they will evaluate a number of characteristics including anti-breaching, anti-climbing and anti-digging capabilities.

"Everybody's for opening a better trade deal, but you don't want to push Humpty Dumpty off the wall", Roberts told TWS.

"You may not be able to put the NAFTA back into that box once it's open, and anti-trade momentum takes over..."

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