Washington DC – Withdrawal from the North American Free Trade Agreement (NAFTA) would create a tariff burden of up to $9 billion on US chemical exports.
That stark warning comes in a recent report from the American Chemistry Council, entitled Withdrawal from NAFTA Would Erode US Manufacturing Competitiveness.
The report foresees higher prices for manufacturers and consumers if the US left NAFTA. There is also the likelihood that Canadian and Mexican companies could turn to Chinese suppliers instead.
In contrast, the report claims, if President Trump were to modernise NAFTA, the US chemical industry could capitalise on the strong competitive advantage created by the shale gas boom.
Under a modernised NAFTA, the report predicts US chemical exports to Canada and Mexico could be a third higher by 2025. This would further support the chemical sector’s positive contribution to the US trade balance, said ACC.