In this April 21, 2008 photo, national flags representing the United States, Canada, and Mexico fly in the breeze in New Orleans where leaders of the North American Free Trade Agreement met. US President Donald Trump has long called the 1994 treaty a bad deal that hurt American workers, saying it should be renegotiated or ended. (JUDI BOTTONI / AP)
WASHINGTON - US President Donald Trump on Wednesday
threatened to terminate the North American Free Trade Agreement (NAFTA) as the fourth
round of talks kicked off in the US state of Virginia.
"It's possible we won't be able to make a deal, and it's possible that we will... we'll see if we can do the kind of changes that we need," Trump told reporters at the White House before a bilateral meeting with visiting Canadian Prime Minister Justin Trudeau.
Trump indicated possibility when asked whether he would consider separate deals with Canada and Mexico if NAFTA doesn't work out
"I think Justin understands this, if we can't make a deal, it will be
terminated and that will be fine," he said.
Asked whether he would consider separate deals with Canada and Mexico if NAFTA does not work out, Trump responded, "I would. Yes. I would see that."
However, trade experts argued that costs of breaking up the trilateral trade agreement would be very high for all three economies, as North American integration has been going well for over 25 years.
"Attempts to change that and disrupt existing supply chains and production networks that are linked together through extensive investments in each other's economy would prove extremely disruptive to production and employment in all three countries," said Jeffrey Schott, senior fellow at the Peterson Institute for International Economics, a Washington-DC-based think tank.
After the meeting with Trump, Trudeau told reporters that he is optimistic that the three countries can reach a deal to modernize the 23-year-old trade pact, as millions of people benefit from the trade agreement.
But Trudeau also emphasized that Canada must "be prepared for anything" as Trump and the US administration are unpredictable.
The bilateral meeting came amid a new round of NAFTA talks, which will last until Oct 17.
Officials will cover two dozen negotiation topics such as government procurement, financial services and the environment during this round of talks, according to the US Trade Representative's Office.