Tags: obama | grassley

Grassley: Obama's NAFTA Positions Hurting Markets

Thursday, 05 Mar 2009 07:39 PM

A top Republican senator on Thursday asked US President Barack Obama to "clarify" his position on the North American Free Trade Agreement, which he made a campaign promise to renegotiate.

"I am concerned that the signals you are sending with respect to the North American Free Trade Agreement are creating uncertainty in the marketplace," Republican Senator Chuck Grassley wrote in a letter to Obama, saying he disagreed with "the idea of renegotiating" the pact.

"I question how this agreement could be changed without having an adverse effect on trade," added the Iowa senator, saying he was concerned about his state's agricultural exports, as Mexico seeks to rebalance tariff concessions.

During last year's election campaign, Obama often criticized the free trade pact between the United States, Canada and Mexico and hinted that he might renegotiate it to include labor and environmental safeguards that would be enforced.

In its recently published trade policy agenda, the Obama administration said it "will also work with Canada and Mexico to identify ways in which NAFTA could be improved without having an adverse effect on trade."

"If new negotiating authority is required, we will seek that from Congress," it added.

Grassley, the ranking Republican on the Senate Finance Committee, sought further clarification from the White House on what would be included in a possible NAFTA renegotiation.

"I ask that you clarify your intentions," he wrote to Obama.

"I also ask you to confirm that, if this trade agreement is reopened, you will not agree to any increases in, or reinstatements of, tariffs on US agricultural products under this trade agreement."

On Monday, Grassley will have a chance to question Obama's nominee for US trade representative, Ronald Kirk, at a Senate confirmation hearing.

During a visit to Canada last month, Obama said he was still keen on improving labor and environmental standards in NAFTA but did not make a strong push to do so immediately.

"My hope is that ... there's a way of doing this that is not disruptive to the extraordinarily important trade relationships that exist between the United States and Canada," he said.

Canada has been wary of renegotiating the deal, but Prime Minister Stephen Harper has said he hoped for progress on the issue.

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