New Report Details Negative Impacts Of NAFTA Withdrawal

Farm groups have sent a steady stream of comments and predictions of what an end to NAFTA could mean for U.S. agriculture. A new report from AT Kearney, in partnership with the Food Marketing Institute, the National Retail Federation and the Retail Industry Leaders Association, finds the costs to consumers and retailers from a U.S. NAFTA withdrawal would be substantial as well.Around $182 billion in cross border trade takes place between the U.S., Canada and Mexico annually thanks to the trade pact, the report noted. The report said a withdrawal by the U.S., which President Donald Trump has threatened to pursue if satisfactory changes to the agreement cannot be reached, would cost consumers $5.3 billion annually and weigh on retailers' bottom lines to the tune of $15.8 billion per year.Ultimately, a withdrawal would negatively affect U.S. economic growth, the report said. "The loss of tariff-free access across North America would have a negative impact on GDP growth, which would in turn translate to more woes for retailers. We estimate that retail spending would drop by $290 per year per U.S. household." Mexico and Canada currently account for 34 percent of all U.S. exports.Retail-related employment would also suffer, according to the report. NAFTA withdrawal "could spell the loss of 128,000 retail-related jobs within the next three years." President Trump has long criticized NAFTA as killing U.S. jobs, so it is notable the report quantifies retail job losses that an exit would incur.