Amid reports of US NAFTA pullout, Mexico leaned on diplomacy

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Unifor president Jerry Dias, who was lauded for securing favourable deals for autoworkers in negotiations with General Motors, Ford and Fiat Chrysler, said the government should deploy an aggressive approach in its response to U.S. President Donald Trump, who threatened to withdraw from NAFTA earlier this week.

The announcement came after reports in U.S. media that Mr Trump and his advisers had been considering giving formal notice on a withdrawal from Nafta. And their palms are not likely sweating over the idea that if NAFTA talks derail, the status quo continues and Trump's big campaign promise to renegotiate crashes into oblivion.

What changed? He talked to Canadian Prime Minister Justin Trudeau and Mexican President Enrique Peña Nieto.

Trump said last week that NAFTA had been extremely bad for United States companies and workers and he was intending to make big changes in it or take the U.S. out of it once and for all. Yesterday, Trump confirmed that was the case, but added a twist in a pair of early morning tweets.

They halted their decline after the White House announcement.

As a candidate, Trump frequently called NAFTA a "disaster" and vowed to renegotiate its terms or scuttle it altogether. But he also said that his consent to remaining is "subject to the fact that if we do not reach a fair deal for all, we will then terminate NAFTA".

The threat to withdraw is consistent with his campaign rhetoric.

U.S. media reported on Wednesday that he was likely to give formal notice of pulling the United States out of NAFTA - and then came the White House announcement that the USA would renegotiate the agreement after all.

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The announcement comes amid reports that the United States is planning to withdraw itself from the trilateral trade bloc.

The New York Times recently quoted an unnamed senior administration official saying that Trump is likely to sign an executive action that would begin the process of withdrawing the United States from NAFTA.

That's because Canada and Mexico have higher tariffs than the United States for countries with whom they don't have trade deals. Instead, it would have initiated a six-month notice period after which the US could have withdrawn or not withdrawn. Certainly, Mexico can do some things better than we do.

Senate confirmation of Robert Lighthizer as Trump's nominee for USA trade representative, who would lead the United States in NAFTA talks, has taken longer than anticipated.

The NAFTA withdrawal process is complex. "I will", Trump told reporters in the Oval Office.

Since NAFTA became law in 1994, exports from the US to Canada and Mexico are up 280% over that time, while imports from the two countries have risen 313%, according to the US Chamber of Commerce.

"What happened to our dairy farmers in Wisconsin and New York State - we're not going to let it happen", the president said, sounding like the "America first" president again.

Jorge Guajardo, a former Mexican diplomat and senior director at the Washington-based global strategy firm McLarty Associates, said he doubted it was merely a ploy to twist the arms of USA lawmakers.

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