NAFTA became operational in January 1994, and links the USA, Canada and Mexico within a single free trade area. The deal is one of Donald Trump’s favourite targets, and was singled out as the cause for the shift of manufacturing jobs away from the US and into Mexico. According to the agreement’s statute, one of the parties may notify the others about its intention to leave, opening a 180-day period in which to begin new negotiations. If no new agreement is then reached, the deal will be dissolved.Canadian daily paper The Globe and Mail wrote last Wednesday that new US Commerce Secretary Wilbur Ross would be sending a notification letter to the Canadian and Mexican governments, asking for the trade deal’s re-negotiation, in the days following Donald Trump’s inauguration, which took place last Friday.

In response, Canada’s Prime Minister Justin Trudeau began a two-day retreat with his cabinet on Monday, focused mainly on the best approach to take with new U.S. President Donald Trump, whose vow to renegotiate NAFTA could damage Canada’s economy.Canadian officials – trying to persuade the new administration that focusing on Canada makes no sense, given how closely the economies are linked – told reporters the Trump team is most concerned about large U.S. deficits with China and Mexico.”They haven’t said anything specific about any real problems that they have with us,” David MacNaughton, Canada’s ambassador to Washington and a key player on the NAFTA file, told Reuters.The White House also indicated that the USA intend to withdraw from the Trans-Pacific Partnership (TPP) agreement, only recently negotiated between Barack Obama’s administration and 11 Asia-Pacific countries, which is yet to be ratified by the US Congress.The agreement notably excluded China, as it aimed to strengthen the Pacific Rim countries in the face of Chinese commercial might. The decision does not however mean that closer links will be forged between the USA and China, the latter being regarded as a major trading competitor by Trump, who mentioned the possibility of raising import duties for Chinese goods. A decision which, according to analysts, would drive inflation up.The USA’s relationship with Europe does not seem to be smooth either, after Trump congratulated the UK for the Brexit vote, and predicted that other countries will soon follow. In other words, a slow death for the EU, with which, until the end of 2016, the USA were negotiating the Transatlantic Trade and Investment Partnership (TTIP). Talks on the proposed agreement eventually ground to a halt, owing to opposition by some EU countries, notably France, and by both US presidential candidates.