President Donald Trump’s changes to the North American Free Trade Agreement would only contribute to modest economic growth and auto jobs, says a new report released on Thursday.
The U.S. International Trade Commission forecasts that the United States Mexico Canada Agreement that the three countries reached last year would increase the real U.S. gross domestic product by about 0.35% or $68.2 billion. Employments would grow by almost 176,000 jobs, or 0.12% as a result of the trade agreement, the report says.
American exports to Canada and Mexico under the USMCA deal, which is yet to be ratified by the three countries, would rise by 5.9% and 6.7%, respectively, CNBC reports.
“The model estimates that the agreement would likely have a positive impact on all broad industry sectors within the U.S. economy. Manufacturing would experience the largest percentage gains in output, exports, wages, and employment, while in absolute terms, services would experience the largest gains in output and employment,” the ITC said in a news release.
President Donald Trump has been pushing Congress to ratify the agreement, maintaining that the revised NAFTA would lead to American manufacturing and job creation in the U.S. despite lawmakers on both sides voicing concerns and reservations about it.
While Trump has touted the agreement as the “largest” trade deal ever, the ITC points out the USMCA is far from being that. Even members of the President’s own party acknowledge the agreement is nothing more than a tweak to NAFTA.
“The miniscule projected gains in this long-awaited official government assessment of the revised NAFTA contradict Donald Trump’s grandiose claims that it will lead to ‘cash and jobs pouring into the U.S.’ and reinforces congressional Democrats’ views that absent more improvements, the revised deal won’t stop NAFTA’s ongoing damage,” said Lori Wallach, director of Public Citizen’s Global Trade Watch.
The ITC also noted that under the provision of the deal, auto costs would rise and sales would fall, underlining the inevitable downfalls of USMCA.