Trump says he'll kill NAFTA if he's not able to renegotiate a better deal

President Donald Trump reacts after signing an executive order on education during an event with governors at the White House, April 26, 2017.

Carlos Barria | Reuters

The United States is prepared to kill NAFTA if renegotiation efforts prove fruitless, President Donald Trump said in an interview that aired Sunday.

In the interview with CBS' "Face the Nation," Trump insisted on Saturday that he was going to terminate the agreement with Canada and Mexico, before having a change of heart when the leaders of both countries reached out to him.

"I got a very nice call from Justin Trudeau, the prime minister of Canada," Trump told CBS. "I was all set to do it. In fact, I was going to do it today. I was going to do it as we're sitting here."

After conversing with Trudeau and Mexican President Enrique Pena Nieto, Trump said he would negotiate the North American Free Trade Agreement. However, the president added that "if I'm not able to renegotiate NAFTA, I will terminate NAFTA."

Trump signed an executive order Saturday directing the Commerce Department and the U.S. trade representative to conduct a study of U.S. trade agreements. The goal is to determine whether America is being treated fairly by its trading partners and the 164-nation World Trade Organization.

Last week, Trump raised eyebrows after he lashed out at Canada, suggesting the country was unfairly disadvantaging U.S. dairy and lumber products. Yet in practice, some economists point out, Trump has been less stridently anti-trade than his campaign rhetoric suggested he would be.

"In general, the Trump administration has, up to now at least, taken a much less protectionist line than we feared after the very dark and foreboding inaugural speech, which talked of putting America first and that protection would lead to prosperity," Capital Economics said in a report.

"However, there is no guarantee that we won't see a renewed protectionist lurch," particularly as warring factions close to the president jockey for advantage, the firm added.

Correction: This story was revised to correct that the interview was conducted on Saturday.

— The Associated Press contributed to this report.