The United States, Mexico and Canada put the finishing touches on a new trade agreement on December 10 in a historic signing in Mexico City.
“The Agreement will create significant new opportunities for American workers, farmers, ranchers, and businesses by opening markets in Canada and Mexico and eliminating barriers to United States goods, services, and investment,” President Trump said December 13, as the U.S. Congress moved closer to passing the deal that Trump signed last year.
The United States-Mexico-Canada Agreement (USMCA) upgrades the 25-year-old North American Free Trade Agreement (NAFTA). Mexico has ratified the deal, while the United States and Canada are moving closer to passing it.
USMCA would bolster North American manufacturing by increasing requirements for automobile producers to use materials made in North America.
President Trump has faulted NAFTA for allowing other countries to ship component parts to Mexico for assembly and then sell the vehicles duty-free in the United States. The new pact would ensure that three-quarters of auto components are made in North America.
The deal would also require that for autos built in North America, workers be paid at least $16 an hour.
The deal also would increase Canadian producers’ market access to export to the United States refined sugar and products containing sugar, as well as certain dairy products, the Canadian government says.
U.S. Secretary of State Michael R. Pompeo calls the USMCA a “modernized trade agreement for the 21st century” that sets high standards for labor and the environment.
“Once implemented, the USMCA will protect North American jobs, raise economic prosperity, and continue to set the standard as the world’s economic powerhouse,” Pompeo said in a December 11 statement.