Buenos Aires, Argentina
Hanging over the win, however, is not only the question of whether Congress — with a new Democratic House majority in January — will approve the deal, but also what the future cost of Trump’s bruising tactics may be for U.S. trade relations generally — including with China, the world’s other economic superpower.
The American president had shown this country’s two neighbors that going it alone and ignoring age-old alliances can pay off, at least in the short term. Yet if the United States no longer values established norms of restraint and mutual consideration, Canada and Mexico — as well as other longtime trading partners — are not likely to feel constrained, either.
A first test looms here at the Group of 20 summit of leaders of the world’s most developed nations, which opened just after the three North American heads of state signed their trade pact in a ceremony on the sidelines. The central question at the gathering is whether Trump’s trade war with China will grow hotter, especially if President Xi Jinping remains as resolutely hard-line as the American president, given the potential risks for the global economy.
Trump and Xi are set to meet over dinner after the G-20 concludes on Saturday.
“The bottom line is that if the Trump-Xi meeting ends badly and the two countries slip into a deeper cold war mindset, the U.S. is likely to become more vocal about engagements by its traditional allies with China,” said Eric Miller, a global fellow at the Wilson Center in Washington.
For example, Miller added, for the United States “this means pushing Canada to limit its engagements with China.”
Yet Canada, perhaps in response to Trump’s aggressive trade stance, is exploring new trade opportunities with China. It is doing so though one of the new NAFTA provisions seeks to restrain Canada or Mexico from making deals with a state-run, non-market economy — namely China.
Trump touted the revised accord with Mexico and Canada as “a truly groundbreaking achievement.” But there was no disguising the tensions lingering from his zero-sum, winner-take-all approach to negotiating with allies.
Canadian Prime Minister Justin Trudeau, who considered skipping the formal signing that Trump was eager for, chose not to follow Trump’s lead and hold up the agreement for the cameras. And he pointedly declined to refer to the agreement by the name that the brand-conscious Trump had given it — “The United States-Mexico-Canada Agreement,” or USMCA, an acronym Trump says recalls the title of a catchy hit song from 40 years ago, YMCA.
