Search ForexCrunch

According to Fitch Ratings, the continued uncertainty over the restructuring of NAFTA with the US at the helm is increasing trade risks for US states, who could see higher export tariffs under WTO rules if NAFTA falls apart.

Key highlights

Uncertainty surrounding NAFTA renegotiations could elevate risks for US states with more to lose from a NAFTA termination.

Fitch says talks are likely to resume, but a full ratification before 2019 is unlikely.

The highest tariffs following a NAFTA collapse would hit agriculture hardest, as well as energies and autos.

Fitch says that a NAFTA collapse would see the greatest risk exposure for US states with heavy trade with Mexico, greatest risks of higher export tariffs.