Commentary: Texans should be concerned if Trump withdraws from NAFTA


President Donald Trump may exercise the power to unilaterally withdraw from the North American Free Trade Agreement but will likely require congressional approval to completely renegotiate NAFTA.

Prime Minister Justin Trudeau of Canada expressed willingness to renegotiate NAFTA, as has the Mexico secretary of foreign relations, Luis Videgaray, who also stated that Mexico would like to renegotiate NAFTA “as soon as possible” to “dispel this uncertainty.”

If Trump withdraws from NAFTA, it is unclear how quickly a similar agreement could be put in place considering the bureaucracy of three different governments, assuming that an agreement is even reached. NAFTA as it currently stands took from the beginning of negotiations in 1990 until Jan. 1, 1994, to go into effect.

Texans should be concerned, because the complete withdrawal from NAFTA and a return of trade barriers with our leading trade partners, Canada and Mexico, will disproportionately and adversely impact the economy of Texas. Close to half, $118 billion, of all Texas exports are to Mexico and Canada, and Texas exports support over 1 million Texas jobs. The top Texas goods exports include $45.3 billion in computer and electronic products, $42.7 billion in petroleum and coal products, $39.8 billion in chemicals, $24.8 billion in machinery, and $22.2 billion in transportation equipment.

According to recent data collected by the office of the governor of Texas, the oil and gas industry accounts for 11.3 percent of Texas gross domestic product. The Texas Railroad Commission estimates that natural gas exports from Texas to Mexico are expected to increase from an average of 2.1 billion cubic feet per day to 3.4 billion cubic feet per day by 2020. Former Texas Gov. Rick Perry, Trump’s pick for secretary of energy, sits on the board of Energy Transfer Partners, which has approval from the Obama administration to build two pipelines to transport natural gas from Texas to Mexico.

Although the current Gov. Greg Abbott has declined to comment on NAFTA, Perry called NAFTA “the largest job stimulus packet to come along this decade” in 1993. Then, in 2002, Perry stated that he would be urging “our friends in Washington” not to enact regulations that would hinder free trade. Former Texas Gov. and U.S. President George W. Bush expressed his support for NAFTA in November, stating that any president should “recognize that trade encourages growth and fair trade is important for the workers of our respective countries.”

NAFTA created the work authorized TN visa category to facilitate the travel of Canadian, U.S. and Mexican professional workers between the member parties to the agreement. These professions include accountants, engineers, consultants, university professors, scientific technicians and another 50 specifically negotiated degreed professions. For Mexican nationals seeking to enter the United States as treaty traders or treaty investors, the E visa category is also based on the NAFTA agreement. This category is available to nationals of many countries with relevant treaties with the United States and requires substantial trade or investment in the United States. Without these visa categories allowing Canadian and Mexican citizens to obtain U.S. immigration status, incentives will be reduced and important mechanisms underlying Foreign Direct Investment will cease to exist.

While the majority of Texans voted for Trump, that does not mean that Texans have supported — or should support — each and every statement made during a heated campaign. During this critical period when administrative priorities are being set, Texans should make the Trump administration aware that campaign rhetoric can now be set aside and make clear that withdrawal from NAFTA is not in the best interest of Texans, Texas jobs and our future economic development.

Loughran is a partner of Foster LLP.



Reader Comments ...


Next Up in Opinion

Letters to the editor: July 24, 2017
Letters to the editor: July 24, 2017

Like many others, I find it strange that a state government that styles itself as conservative — against “big” government, and in favor of citizens’ rights — would be against local governments establishing ordinances to protect their trees. Is it that those trying to micromanage us from Austin are so deep into the pockets...
Opinion: Why would you want Putin as a friend?

Leaving aside the question as to whether there was actual collusion between the Trump campaign and the Russian government during the 2016 election, it is undisputed that candidate Donald Trump was eager for a friendship between our two nations. The most recent accounts of the president seeking out more one-on-one time with Putin at the G-20 dinner...
COMMENTARY: Wait for Trump to sabotage your health care

Is Trumpcare finally dead? Even now, it’s hard to be sure, especially given Republican moderates’ long track record of caving in to extremists at crucial moments. But it does look as if the frontal assault on the Affordable Care Act has failed. And let’s be clear: The reason this assault failed wasn’t that Donald Trump did a...
Opinion: This isn't the first U.S. opiate-addiction crisis
Opinion: This isn't the first U.S. opiate-addiction crisis

The U.S. is in the throes of an "unprecedented opioid epidemic," the Centers for Disease Control reports. The crisis has spurred calls for action to halt the rising death toll, which has devastated many rural communities. It's true that there's an opioid epidemic, a public health disaster. It's not true that it's unprecedented. A remarkably...
Herman: Austin pioneers resting in peace in ABIA flight path
Herman: Austin pioneers resting in peace in ABIA flight path

Welcome to the latest installment of “What Is That?” Today we’re off to a cemetery in a highway interchange. So that’s kind of different. Today’s inquiry comes from Austinite Sherry Statman who thinks she’s come across bodies buried near the Austin-Bergstrom International Airport. Maybe you’ve seen them...
More Stories