Tresury & Risk Home Menu

NAFTA Collapse Would Hurt Regional Economy

Mexico would be hit hardest and could shed almost 1 million low-skilled jobs.

The collapse of the North American Free Trade Agreement would likely damage yet not derail the continent’s economy and business models of global corporations.

That’s the conclusion of economists trying to envisage life after the 23-year-old accord as increasingly tense negotiations over how to revamp it fuel speculation that President Donald Trump will follow through on his threat to withdraw.


Helping Workers?

One of the keys to Trump’s election last year was his appeal among voters in states hurt by the decline in manufacturing employment, such as Ohio and Pennsylvania.

Some companies would probably move production back to the U.S. if the president withdraws from the deal, said Michael Stumo, CEO of Coalition for a Prosperous America, a nonprofit group that has supported the administration’s skepticism toward free trade. However, addressing currency imbalances would be a more durable way of shifting trade flows, he added.

Copyright 2017 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Comments