While the new United States-Mexico-Canada Agreement (USMCA) avoids tariffs, it will make it harder for global automakers to build cars cheaply in Mexico and is aimed at bringing more jobs into the United States.
It is the biggest-ever and the best trade deal in the world - that's how U.S. President Donald Trump and members of his administration are touting a new trade pact they have reached with neighbors Canada and Mexico. The U.S. will be less anxious about running afoul of the World Trade Organization, a.
Embracing the U.S. -Mexico-Canada Agreement during a Rose Garden ceremony, Trump branded the trade deal the "USMCA", a moniker he said would replace the 24-year-old North American Free Trade Agreement, or NAFTA.
USA lawmakers and business have urged the administration to keep Canada in the deal but the trilateral nature had been in jeopardy after Trump on August 27 announced he reached a deal with Mexico that Canada could join if it's willing to make concessions. Beijing responded by announcing tariffs of 5 percent to 10 percent on an additional $60 billion worth of US imports.
Early on Monday a copy of the deal's 34 chapters was posted on the U.S. Trade Representative's website.
"The negotiation will not be reopened with the United States".
If the new agreement is approved, USA farmers will be allowed to sell a bigger quantity of their dairy products in Canada, up to 3.6 per cent of the Canadian dairy market, before those prohibitive tariff rates kick in.
"His tariffs are too high, he doesn't seem to want to move and I've told him forget about it", Trump said at a freewheeling press conference. If those talks lead to a deal, the signatory could potentially be frozen out of the North American pact.
Hall Findlay said the Class 7 concessions, combined with wider access to the dairy market for US firms, will restrict the ability of Canadian firms to compete globally.
"For those babies out there who keep talking about tariffs", this deal would not have happened without tariffs, Trump told reporters during a almost 80-minute event in the White House Rose Garden.
"Anything you submit to Congress is trouble no matter what", Trump said, predicting that Democrats would say, "Trump likes it so we're not going to approve it".
The new agreement, subject to ratification, is called the United States, Mexico and Canada Agreement, otherwise referred to as the USMCA.
"The next step will be to bear down on China with a broader coalition", said Mr David Hensley, director of global economics for JPMorgan Chase in NY, noting that other countries share America's concerns about Beijing's alleged unfair trade practices and mercantilism.
Robert Lighthizer was the public face of arduous, year-long talks to rework NAFTA, but as he savored a successful conclusion in the White House Rose Garden on Monday, the USA trade representative singled out another man as the deal's architect. The Trump administration set a September 30 deadline for Canada to join the agreement, or tariffs would be placed on vehicles exported to the U.S. "Without tariffs, we wouldn't be standing here", he said.
The news delighted financial markets that had fretted for months about the potential economic damage if NAFTA blew up. The U.S. wanted to get rid of it.
USMCA also said that Mexico needed to make it easier for workers to form unions. But he said it was more of an American political statement aimed at China than a real effort to undermine Canada's sovereignty.
Ultimately, Beijing may not have as much firepower as the United States to retaliate, given the United States buys much more from China than it sells.