IMF welcomes NAFTA negotiations
The IMF today defended the ongoing NAFTA negotiations with its chief Christine Lagarde arguing that any trade deal that is two decades-old needs to be revised and reviewed.
"For a trade agreement which has been in existence for, what, 20 years now, it is not unusual or unnecessary to actually look into it, go under the skin of the agreement, find out what works, what does not work, what can be improved, what new topics should be considered -- given the changes that have affected the markets in the last two decades," Lagarde told reporters at a news conference here.
"Twenty years ago, were we communicating by cell phones? Were those economies so service-dominated? Probably not. That there have been negotiations is certainly welcome," she said.
The IMF chief, who, in her previous roles served as French finance minister, agriculture minister, and minister of commerce and industry, said trade agreements should be revised from time to time.
"I, actually, personally think, having been trade minister myself for a few years in my country, that trade agreements should constantly take into account changes in order to be adjusted and to continue to facilitate trade and to increase the movement," she said.
However, Lagarde said, the aim should not be to just accelerate the movement.
"It has also to consider what regions, what areas, what sectors are going to be affected by trade, and what measures will be taken in order to address those issues in order to help people adjust, relocate, be mobile, acquire the training that will help them also benefit from the situation," she said.
Lagarde said her comment applied equally to trade and to technological changes that are taking place at the moment.
However, she refrained from making any direct comment on the ongoing North America Free Trade Agreement (NAFTA) negotiations.
"It is underway, and I would refrain from commenting on the current state of negotiations which always -- like in any negotiations -- involve taking certain positions with allowing maneuvering room and organising the landing area where negotiators want to eventually arrive at," she said.
NAFTA is an agreement signed by Canada, Mexico and the US to create a trilateral trade bloc in North America. The current negotiations were necessitated after Trump threatened to pull out from the agreement if the renegotiations did not take place.
During his entire presidential campaign, Trump had been very critical of NAFTA, which came into force in 1994.
Responding to another question, Lagarde said the relevance of IMF was unlikely to be hit with the Europeans creating a European Monetary Fund.
"I have no fear. I have no fear," she said, adding that she has expectations.
"Having been on both sides of the fence, having been finance minister, working with the IMF in, you know, 2010- 2011, now being head of the IMF, I know that the cooperation was very much needed and will continue to be needed in a shape or form that will be determined by the European actors," she said.
Lagarde said the IMF was the "international financial safety net" and the organisation will continue to play that role
"That is our mission. That is our duty," she said.