If negotiations about the North American Free Trade Agreement fail and the pact is terminated, North Carolina would suffer a “slight negative” in terms of economic impact, according to a new study by NCSU economist Dr. Michael Walden.

Walden concludes that the state would suffer a net loss of nearly 5,600 jobs and a $457 million drop in the North Carolina gross domestic product.

White Walden notes that the numbers are ‘important,” he also points out that they represent a “relatively small part of North Carolina’s total economy, with reduction in GDP being 0.1 percent of total state GDP, and the job loss being 0.13 percent of total employment in the state.”

“The empirical analysis shows an end of NAFTA and a return to higher tariffs between the U.S., Mexico, and Canada will affect North Carolina in measurable, but relatively minor, ways,” he writes in the report.

Walden released the study Wednesday.

President Trump has made the making of changes in NAFTA to terms he would consider more fair to the U.S. a priority of his administration. If changes aren’t made, he could terminate the deal.

Walden also points out that “some economic sectors in the state would gain from NAFTA’s end,” including:

  • Electronic equipment
  • Chemicals/rubber/plastics
  • Other manufacturing

“Losers” would include:

  • Food processing
  • Livestock
  • Motor vehicle parts

Walden also said his conclusions were based on “short-run” calculations and added that more analysis is needed to determine “long-run” impacts.

“Short-run changes would create almost immediate impacts, but they don’t account for the possibility of companies moving production facilities among the NAFTA as well as other countries,” he writes.

“The change in such capital investments takes considerable time and would be the subject of a complementary long-run analysis. ”

The economist utilized a formula developed by Terrie Walmsley and Peter Minor of ImpactECON for a national review of what terminating NAFTA would mean for the U.S. economy.