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Ohio Exporters At Risk If NAFTA Talks Fail With Canada

Some of Ohio’s major exporting industries, including agriculture and automotive manufacturing, could suffer if the United States and Mexico make a trade deal without Canada.

The countries are reportedly in negotiations, trying to reach a deal on a revised North American Free Trade Agreement, or NAFTA, by Friday. However, earlier this week, President Trump said that if Canada won't sign on, the U.S. and Mexico will do their ownbilateral deal.

 

Ohio farmers  exported about $1.5 billion dollars in agricultural products to Canada last year. They have benefited from NAFTA, said Joe Cornely, a spokesman for the Ohio Farm Bureau. On Wednesday, he said that a trade deal that cuts Canada out would be a dicey prospect for Ohio farmers.

 

“Our message to the administration is, ‘do no harm; keep agriculture's gains intact,’” Cornely said.

 

A trade pact that does not include Canada would also spell uncertainty for Ohio’s automotive manufacturing sector. That's because the terms being negotiated by the U.S., Mexico and Canada include big changes to NAFTA's auto manufacturing rules.

"The big thing about the auto sector, is it's so highly integrated across the three countries," said Bill Kosteas, a professor of international economics at Cleveland State University. "It's very difficult to see how we'd move forward without Canada being involved."

According to the Congressional Research Service, roughly a third of Ohio exports to Canada in 2016 were motor vehicles or motor vehicle parts. That's about five times what it was for Mexico over the same period. 

"If it does happen, which I highly doubt, it's going to cause real problems for those industries," he added.

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