Update: President Trump issued a memorandum on the withdrawal from the Trans-Pacific Partnership on Jan. 23, but has yet to issue an official order, proclamation, or memorandum with regards to NAFTA.
- During his first full business day in office, President Donald Trump will sign a handful of executive orders, the first of which will be withdrawal from the Trans-Pacific Partnership, various news outlets reported.
- In addition, the President is expected to sign an executive order stating his intent to renegotiate the North American Free Trade Agreement (NAFTA).
- The two executive orders would fulfill a pledge the President made mid-November to sign a series of executive orders that he stated would put America first from his first day in office. Trump had made his intention to withdraw from or renegotiate the deals evident throughout the campaign.
The orders' immediate impact will hardly be notable.
In the long run, orders of intent only serve to cement the President's promises to the rest of the world. After all, the TPP was considered dead from the moment Trump took office, despite some proponents' fleeting hope that Trump would reconsider the move; and the Presidents of Mexico and Canada have already declared their willingness to collaborate in a renegotiation of the decades-old NAFTA.
Meanwhile, short-term effects will be limited to perceptions of Trump's efficacy in office and currency fluctuations. Both the Mexican peso and the Canadian dollar, for example, have been on the rise since Trump's inauguration on Friday despite the President's anti-trade rhetoric. If the orders negatively target any specific sectors based in Mexico or Canada by way of tariff, however, the trend could easily reverse.
The most important effects of the President's first moves likely will come in the medium-term, as Trump sets the tone of trade renegotiation when he announces the orders, and in meetings with Mexican and Canadian officials throughout the month. Already, leading Mexican economic officials are set to meet with members of the Trump administration on Wednesday, and the Mexican President will meet with Trump on Jan. 31.
In other words, all signals show stakeholders are preparing for a NAFTA renegotiation — which is set to be a lengthy, technical process — to begin as soon as possible and on the right foot. Perhaps the goal is to conclude the process before the seemingly friendly Mexican President leaves office December, 2018.