Trump: NAFTA deal will be terminated in 'near future'

ABOARD AIR FORCE ONE (Reuters) - U.S. President Donald Trump said on Saturday he will give formal notice to the U.S. Congress in the near future to terminate the North American Free Trade Agreement (NAFTA), giving six months for lawmakers to approve a new trade deal signed on Friday.

"I will be formally terminating NAFTA shortly," Trump told reporters aboard Air Force One on his way home from Argentina.

"Just so you understand, when I do that - if for any reason we're unable to make a deal because of Congress then Congress will have a choice" of the new deal or returning to trade rules from before 1994 when NAFTA took effect, he said.

Trump told reporters the trade rules before NAFTA "work very well." NAFTA allows any country to formally withdraw with six months notice.

Trump, Canadian Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto signed a new trade agreement on Friday known as the United States-Mexico-Canada Agreement (USMCA).

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NAFTA deal gives little help to US dairy farmers
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NAFTA deal gives little help to US dairy farmers

Miss USA and two other dairy cows eat their breakfast after their morning milking at EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 7 April, 2018. Scooter and Cynthia LaPrise have about 30 cows on one of eight remaining dairy farms in Rhode Island. Miss USA is their daughter Maggie's show cow that was recently named Supreme Champion at this year's New England 4-H Program. 

(REUTERS/Oliver Doyle)

Cynthia LaPrise, 52, the co-owner of EMMA Acres dairy farm, discusses the state of dairy farms with her brother Paul Bailey in East Greenwich, Rhode Island, U.S., April 12, 2018. Cynthia is also a nurse at the Miriam Hospital in Providence, Rhode Island.

(REUTERS/Oliver Doyle)

Former dairy farmer Rodney Bailey, 90, and his sister Gladys, 94, sit in their home on farmland that has been a part of their family for generations in East Greenwich, Rhode Island, U.S., 12 April, 2018. Rodney is known as the "last of his kind" by local publication - the last farmer from the golden age of Rhode Island Dairy.

(REUTERS/Oliver Doyle)

A barn of a dairy farm that has long been out of operation belonging to former dairy farmer Rodney Bailey and his sister Gladys, is seen in East Greenwich, Rhode Island, U.S., 12 April 2018. The owners are thinking about turning this barn and the farmland surrounding it, into a wedding venue. 

(REUTERS/Oliver Doyle)

Bailey Brook Farm that belongs to former dairy farmer Rodney Bailey is seen in East Greenwich, Rhode Island, U.S., 12 April, 2018. Bailey still lives on this land though it is no longer in operation as a dairy farm. His daughter Cynthia LaPrise grew up on the farm. 

(REUTERS/Oliver Doyle)

Cynthia LaPrise, 52, the co-owner of EMMA Acres dairy farm, milks the cows, in Exeter, Rhode Island, U.S., 12 April, 2018. "Moms Rims" can be seen written on the dividers. Cynthia said that one of her children wrote it long ago. 

(REUTERS/Oliver Doyle)

Scooter LaPrise, 53, uses his bulldozer to dump feed for the cows into the steaming mixer at EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 7 April, 2018. Scooter with his wife has about 30 cows on one of eight remaining dairy farms in Rhode Island. The cows get their breakfast after their morning milking. 

(REUTERS/Oliver Doyle)

Cynthia LaPrise, 52, the co-owner of EMMA Acres dairy farm, pokes her head into small living quarters above the milk storage room at the farm, in Exeter, Rhode Island, U.S., 12 April, 2018. The area also serves as a place to stay when the farmers need to stay close to their cows. Cynthia is also a nurse at the Miriam Hospital in Providence, Rhode Island. 

(REUTERS/Oliver Doyle)

Scooter LaPrise, 53, uses his bulldozer to dump feed for the cows into the steaming mixer at EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 7 April, 2018. Scooter with his wife has about 30 cows on one of eight remaining dairy farms in Rhode Island. The cows get their breakfast after their morning milking. 

(REUTERS/Oliver Doyle)

Scooter LaPrise, 53, herds his cows into the milking parlour for the morning milking at EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 7 April, 2018. Scooter shouts "Come on, Ladies!" as he directs his cows from their stalls into the milking parlour. Scooter with his wife has about 30 cows on one of eight remaining dairy farms in Rhode Island. 

(REUTERS/Oliver Doyle)

An old Rhody Fresh sign sits in the overgrowth behind the recently closed Cottrell Homestead dairy farm in West Kingston, Rhode Island, U.S., 15 July 2018. 

(REUTERS/Oliver Doyle)

Julie Brodeur, one of the farmers at Cottrell Homestead dairy farm, speaks with a man who visited inquiring about the status of the farm, in West Kingston, Rhode Island, U.S., 15 July, 2018. 

(REUTERS/Oliver Doyle)

Three cows stand in the summer heat at the recently closed Cottrell Homestead dairy farm in West Kingston, Rhode Island, U.S., 14 July 2018. The Cottrell Homestead at its peak was home to over 80 cows. Today, the farm houses less than 20, some of which are just being boarded there by their owners. They milk what they need to feed the calves, and dump the rest. 

(REUTERS/Oliver Doyle)

Scooter LaPrise, 53, and Cynthia LaPrise, 52, the owners of EMMA Acres dairy farm, gather in the milk storage room preparing for the truck that picks up the milk to arrive in Exeter, Rhode Island, U.S., 7 April, 2018. Milk is stored in the large stainless steel vat seen behind them. 

(REUTERS/Oliver Doyle)

Scooter LaPrise, 53, walks from the milk storage room after the nighttime milking at EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 12 April, 2018. Scooter with his wife has about 30 cows on one of eight remaining dairy farms in Rhode Island. 

(REUTERS/Oliver Doyle)

The AgriMark truck collects milk from EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 7 April, 2018. 

(REUTERS/Oliver Doyle)

Cynthia LaPrise, 52, and Scooter LaPrise, 53, the owners of EMMA Acres dairy farm, milk their cows, in Exeter, Rhode Island, U.S., 7 April, 2018. Scooter and Cynthia LaPrise have about 30 cows on one of eight remaining dairy farms in Rhode Island. They are a married couple and have four children. They have been producing milk at their dairy farm for 10 years. Their smaller sized milk parlour holds up to 10 cows at a time. 

(REUTERS/Oliver Doyle)

Dairy cows are seen in their stalls before their daily milking at EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 7 April, 2018. 

(REUTERS/Oliver Doyle)

Supplies, old signs for decoration, and trophies from contests line the walls at a barn at EMMA Acres dairy farm, in Exeter, Rhode Island, U.S., 7 April, 2018. 

(REUTERS/Oliver Doyle)

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Trump's decision to set in motion a possible end to largely free trade in North America comes amid some skepticism from Democrats about the new trade deal.

The U.S. landscape will shift significantly in January when Democrats take control of the House of Representatives, after winning mid-term elections in November.

Presumptive incoming Speaker of the House Nancy Pelosi described the deal as a "work in progress" that lacks worker and environment protections.

"This is not something where we have a piece of paper we can say yes or no to," she said at a news conference on Friday, noting that Mexico had yet to pass a law on wages and working conditions.

Other Democrats, backed by unions that oppose the pact, have called for stronger enforcement provisions for new labor and environmental standards, arguing that USMCA's state-to-state dispute settlement mechanism is too weak.

A 2016 congressional research report said there is a debate over whether a president can withdraw from a trade deal without the consent of Congress, and there is no historical precedent for the unilateral withdrawal from an free trade deal by a president that had been approved by Congress.

The issue could ultimately be decided by the U.S. courts.

The U.S. Chamber of Commerce said last year that exiting NAFTA without a new deal could devastate American agriculture, cost hundreds of thousands of jobs and "be an economic, political and national-security disaster."

The leaders of the three countries agreed on a deal in principle to replace NAFTA, which governs more than $1.2 trillion of mutual trade, after acrimonious negotiations concluded on Sept. 30.

Trump had vowed to revamp NAFTA during his 2016 presidential election campaign. He threatened to tear it up and withdraw the United States completely at times during the negotiation, which would have left trade between the three neighbors in disarray.

The three were still bickering over the finer points of the deal just hours before officials were due to sit down and sign it.

Legislators in Canada and Mexico must still approve the pact.

Trump had forced Canada and Mexico to renegotiate the 24-year-old agreement because he said it encouraged U.S. companies to move jobs to low-wage Mexico.

U.S. objections to Canada's protected internal market for dairy products was a major challenge facing negotiators during the talks, and Trump repeatedly demanded concessions and accused Canada of hurting U.S. farmers.

 

(Reporting by Roberta Rampton aboard Air Force One; writing by David Shepardson in Washington; Editing by Robert Birsel)

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