The presidential race has rocketed NAFTA and the U.S. trade deficit back into the headlines.

A key player for the White House on the issues is Susan Schwab, the U.S. trade representative since the summer of 2006. To Schwab, free trade is a key element -- and big money -- for the U.S. economy. But the 52-year-old must also focus on major issues like piracy, drugs and toy safety.

Is NAFTA good for the economy?

Schwab's overarching task is to negotiate with foreign governments to create trade agreements and resolve disputes. Although her mandate is global, China is a major focus for the trade representative -- in part because of its size (and pace of growth), and in part because of the special issues endemic to the relationship.

What's next for our relationship with China?

Take product quality, for instance: Companies such as Mattel (MAT, news, msgs) and Pfizer (PFE, news, msgs) have faced problems with tainted or counterfeit Chinese-made goods. Mattel has recalled nearly 1 million toys that were made in China because of excessive levels of lead paint; Pfizer has been dealing with counterfeit versions of its drug Lipitor, a cholesterol fighter, and Viagra.

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At the same time, Schwab is keeping a close eye on the U.S. trade deficit. In 2007, the country's trade deficit showed its first yearly decline since 2001 -- a 6.2% drop to $711.6 billion. Exports in 2007 totaled $1.62 trillion, a 12.7% increase from 2006, thanks in part to a weaker dollar. U.S. exports become cheaper, and therefore more attractive, overseas when the dollar is weak. Strong demand for U.S.-made industrial and manufacturing products from growing emerging economies also contributed to the strength of U.S. exports. Imports rose 5.9% to $2.33 trillion last year.

International trade remains essential to the U.S. economy, Schwab says -- particularly during this time of economic turbulence. "U.S. exports now account for an unprecedented 12% of our GDP," she says.

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Schwab, the product of a Foreign Service family, grew up in Africa, Europe and Asia. She spoke with MSN Money in New York this month, covering subjects ranging from the economy and NAFTA to phony drugs, counterfeiting and the U.S. trade relationship with China.

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Published March 13, 2008