Recently, all major US free trade deals in North America, Latin America and Asia Pacific have fallen under fire. As American legacy in free trade is dimming, there is a new opportunity for real free trade in Asia Pacific.

Recently, Canadian Prime Minister Justin Trudeau concluded a visit to China. The joint talks about a free trade pact began over a year ago. As Trudeau left Beijing, Western media headlined “Trudeau leaves China empty-handed,” while Chinese Foreign Ministry said that “both China and Canada showed willingness to negotiate and sign a free trade agreement.”

In reality, the world of free trade is now in the kind of flux that has not been since the post-1945 era.

If the US withdraws from the North American Free Trade Agreement (NAFTA), that would start a six-month legal process before official termination. While President Trump may see this as a negotiating tool to force Canada and Mexico to accept its demands, the latter may use the time to complete trade talks with Brazil and the European Union (EU).

After the fifth round of NAFTA talks ended amid simmering tensions, Canada and Mexico are hedging their bets against a potential NAFTA collapse by pushing for deals with new partners, particularly with China and other Asian countries.

The rise and fall of NAFTA

NAFTA is not just another free-trade agreement. It is America’s post-Cold War blueprint for other free traded agreements (FTAs). It came into force in 1994, amid the globalization boom. Despite fanfares, the key leaders faced a brutal aftermath.

President Bill Clinton’s alleged abuses of public power led to a special counsel in the 1990s. After Prime Minister Brian Mulroney was blamed for fraud by the Canadian Justice Department, he won an out-of-court settlement but reportedly neglected to inform the courts about payments that could have affected the settlement. Mexico’s President Carlos Salinas was appointed WTO’s Director-General and left Mexico as his brothers were prosecuted in a multimillion-dollar fraud case; his older brother, a figure in cocaine cartel trade, was convicted for murder; the younger brother was found dead with a plastic bag strapped around his head.

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