USMCA Trade Agreement
Last fall, the United States, Mexico, and Canada came to agreement on a trilateral trade that will better benefit North American workers. This trade agreement sprouted after renegotiating NAFTA which, Trump stated to be the “worst trade deal ever.” The new agreement is now called the United States-Mexico-Canada Agreement, otherwise known as USMCA. By the way, it is normal practice that each country puts its own name first in multilateral treaties. Canada will change the order of the countries in its legal version of the name, putting Canada first (CUSMA). Mexico will call the new agreement (TMEUC).
Several steps are still necessary to move forward with the deal, including passing Congress. Take a quick look at one of our articles with a supplemental video discussing when the USMCA will be enforced.
The Benefits of the New Trade Agreement
Information derived from Benefits of USMCA
- Creates a more level playing field for American workers, including improved rules of origin for automobiles, trucks, other products, and disciplines on currency manipulation.
- Benefits American farmers, ranchers, and agribusinesses by modernizing and strengthening food and agriculture trade in North America.
- Supports a 21st Century economy through new protections for U.S. intellectual property, and ensuring opportunities for trade in U.S. services.
- Includes new chapters covering Digital Trade, Anti-corruption, and Good Regulatory Practices, as well as a chapter devoted to ensuring that Small and Medium Sized Enterprises benefit from the Agreement.
Though the trade agreement is passed and will be going into effect, currently the Republicans and Democrats are in a dispute about how it will impact America. Though in the big scheme of things, overall the agreement creates fair trade between the three countries. Some of the concerns revolve around agriculture. As stated in an article written by American Shipper, “Florida Commissioner of Agriculture and Consumer Services Nikki Fried criticized the USMCA on Twitter Monday. She tweeted the state’s farmers will be hurt ‘by continued unfair trade & Mexican dumping of seasonal crops.'” Another issue to come to surface involves auto parts. Under the new trade agreement, the USMCA would “require the regional content value of automotive content increase to 75%, which is up from the 60% under NAFTA.” The problem before with the 60% was what was happening with the other 40% that could come from wherever. Before the agreement, China was able to ship all their parts to Mexico and then imported into United States tax free, which the new agreement will get rid off.
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