Today the new United States-Mexico-Canada Agreement (USMCA) was signed by U.S President Donald Trump, Canadian Prime Minister Justin Trudeau, and Mexican President Enrique Peña Nieto. The USMCA is the replacement of, “The worst trade deal ever,” aka the North American Free Trade Agreement (NAFTA). This new pact was signed in Buenos Aires ahead of the G20 Summit, after over a year of negotiations between the three world leaders.
The USMCA needs to pass in Congress before it can take full effect and replace NAFTA, enacted in 1993. The U.S began the takedown of NAFTA and set the goals to bring back jobs to America and halt further outsourcing. CNN received a quote from President Donald Trump stating, “In the U.S, the new trade pact will support high-paying manufacturing jobs and promote greater access for American exports across the range of sectors including our farming, manufacturing and service industries.
Both U.S political parties have opinions on changes to be made before the deal can pass through the House of Representatives. Also, Prime Minister Trudeau has expressed concern of U.S tariffs on steel and aluminum but displays confidence that this will resolve. In a statement, he said, “With hard work, goodwill, and determination, I’m confident we will get there. Our shared interest, prosperity, and security demand it.”
Not all Canadians echo this sentiment. A massive critic of the deal has been the Canadian dairy industry which believes that American access will threaten the domestic market. On the American side, some government officials think the USMCA will not raise wages, create OR keep jobs. Others don’t like the way social issues made their way into the verbiage. It may be that the fight over USMCA is far from over. Here’s a look at some of the differences between NAFTA and USMCA:
- There is a new chapter on digital trade.
- For a vehicle to be free from tariffs, a majority of its parts must be made in North America.
- The same vehicle must be built by workers earning a minimum of $16 an hour.
- American dairy products now have access to the Canadian dairy market.
- The Canadian dairy industry must make the pricing information public to the U.S.
- They must inform the U.S if they create changes to their current milk classification system.
- CBC News added that there’s a new chapter against discrimination in the workplace. This chapter protects gender identity, women, and other sensitive issues.