Trump makes big trade threat before heading to tense G7 summit

"Now, if we're unable to make a deal, we'll terminate NAFTA."

US President Donald Trump speaks to the press before departing the White House for the G7 summit in Washington, DC, on June 8, 2018. (CREDIT: NICHOLAS KAMM/AFP/Getty Images)
US President Donald Trump speaks to the press before departing the White House for the G7 summit in Washington, DC, on June 8, 2018. (CREDIT: NICHOLAS KAMM/AFP/Getty Images)

President Donald Trump on Friday threatened to “terminate” the North American Free Trade Agreement (NAFTA) if he is not able to reach a trade deal at the G7 Summit.

“Now, if we’re unable to make a deal, we’ll terminate NAFTA,” Trump told reporters. “We’ll have a better deal. If we’re unable to make a deal, we will be better off. Right now, we are not going to live with the deals the way they are. European union treats us very unfairly. Canada, very unfairly. Mexico, very unfairly. With that being said, I think we’ll probably very easily make a deal.”

He did not explain what kind of trade deal he was looking for.

Trump is heading to the G7 Summit in Quebec, Canada with nearly every other attendee mad at him. The summit — which includes leaders of the Untied States, United Kingdom, Canada, France, Germany, Italy, Japan, and the European Union —  is meant to discuss issues like trade, climate change, and women’s rights.

This year’s summit, however, comes at a time of increasing tensions.

Trump announced worldwide tariffs on steel and aluminum imports in March, with an an exemption for some trading partners. Last week, however, steel and aluminum tariffs on imports from Mexico, Canada, and the European Union finally went into effect. Commerce Secretary Wilbur Ross said the tariffs on the former two countries were due to a lack of progress in NAFTA talks. Canadian Prime Minister Justin Trudeau later said that those talks stalled because the Trump administration demanded a five-year sunset clause on the agreement.


On Wednesday, the E.U. announced $3 billion worth of tariffs on U.S. products in retaliation would go into effect next month. The tariffs target U.S. steel and aluminum, as well as other items like bourbon, motorcycles, peanut butter, chewing tobacco, and orange juice. Mexico and Canada have also responded with their own retaliatory tariffs.

It’s not clear what kind of trade deal or update to NAFTA Trump is seeking at the G7 Summit, especially since Mexican officials are not attending. Earlier this week, White House economic adviser Larry Kudow said that Trump was not looking to withdraw from the agreement and was instead trying to negotiate separate deals with Mexico and Canada.

“He is very seriously contemplating kind of a shift in the NAFTA negotiations. His preference now, and he asked me to convey this, is to actually negotiate with Mexico and Canada separately,” Kudlow said on Fox News on Tuesday. “He prefers bilateral negotiations and he‘s looking at two, much different countries.”

“The president is not going to leave NAFTA, he‘s not going to withdraw from NAFTA,” Kudlow said. “He’s just going to try a different approach.”

Last month, Trump violated and withdrew from the Iranian nuclear agreement, going against the wishes of the rest of the P5+1 (China, France, Russia, Germany, and the United Kingdom) countries who are all signatories to the deal. Since then, his administration has threatened to sanction other countries doing business with Iran, including those signatories and putting the deal further in jeopardy.


Trump has attacked both France and Canada on Twitter leading up to the summit. On Thursday, French President Emmanuel Macron said on Twitter that the other countries at the summit do not mind “signing a 6 country agreement if need be,” without the United States.

There will be no formal bilateral meeting between Trump and British Prime Minister Theresa May during the summit this year. Like other countries attending the summit, May has criticized U.S. tariffs, saying on Thursday that the United Kingdom seeks to be “a great champion for free trade around the world.”

Japanese officials have similarly hit back at proposed tariffs on auto imports, with Prime Minister Shinzo Abe saying last month that the country simply “can’t accept this.”

Also on Friday, Trump suggested that Russia rejoin the G7. Trump is expected to leave the summit early, which means he will miss the climate portion of the summit.