U.S. proposes to replace NAFTA with two separate agreements

The President of the United States Donald Trump has revived the idea of canceling the North American Free Trade Agreement (NAFTA) and draft instead two bilateral agreements: one with Canada and one with Mexico .

While the request isn't new and both Mexico and Canada previously defended the trilateral agreement, this new insistence comes at the beginning of a trade measure which has angered all parties involved.

Last Friday, the U.S. imposed a 25% tariff on steel imports and a 10% one to aluminum imports for Mexico, Canada, and the European Union.

“You're talking about a very different two countries. I wouldn't mind seeing a separate deal with Canada where you have one type of product...and a separate deal with Mexico,” said president Trump.

For her part, Canada's Minister of Foreign Affairs Chrystia Freeland qualified the tariffs as “illegal” and announced the Canadian government has filed a challenge of the tariffs before the World Trade Organization (WTO) .

The European Union has also opened a dispute settlement case before this organization, which gives them 60 days to resolve the matter,

“We are not in a trade war,” stated EU Trade Commissioner Cecilia Malmström , “But we are in a very difficult situation caused by the United States.”

While the EU seems to have a list of goods to hit with retaliatory tariffs – such as jeans and Harley-Davidson bikes – they haven't made any official announcement.

Mexico hits back on U.S. tariffs

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