The statement comes as his administration is in the midst of seeking federal funding for his long-promised border wall and also renegotiating the US' trade deal with Canada and Mexico.
"They can pay for it indirectly through NAFTA," Trump said Thursday in an interview with The Wall Street Journal
. "We make a good deal on NAFTA, and, say, 'I'm going to take a small percentage of that money and it's going toward the wall.' Guess what? Mexico's paying."
Trump's comments came hours after he was updated by his administration's top economic and trade advisers on the progress of those negotiations and the administration's trade actions more broadly.
Trump repeatedly promised during the campaign that he would build a wall on the Southern US border and force Mexico to pay for it. But Trump has seen little progress on either front, with Democrats in Congress refusing to greenlight funding for Trump's border wall and the Mexican President making clear Mexico would never fund Trump's proposed barrier.
But Trump has also previously suggested that he would seek indirect payment from Mexico to fund the wall. His latest assertion suggested he would direct a surplus in revenue from improved trade with Mexico toward paying for the wall -- though he did not lay out a mechanism for doing so.
Trump warned Thursday that if Mexico did not agree to new terms on the free trade deal, known formally as the North American Free Trade Agreement, then he would simply "terminate" the deal.
"Now, Mexico may not want to make the NAFTA deal, which is OK, then I'll terminate NAFTA, which I think would be frankly a positive for our country," Trump told the Journal.
Trump's comments could also confuse the administration's efforts to extract funding for his border wall through legislation that would protect undocumented immigrants who came to the US as children, after the President rescinded the Deferred Action for Childhood Arrivals program in the fall. Trump has signaled he would only agree to a DACA deal if it includes additional border security funding, including for a new border wall.
Still, Trump has repeatedly said he needed federal funding for the border wall -- with repayment from Mexico to follow.