In recent news, the United States signed a new trade agreement with Mexico and Canada, replacing the former North American Free Trade Agreement (NAFTA). This new agreement, called the United States-Mexico-Canada Agreement (USMCA), was negotiated by the Trump administration and was ratified by all three countries in 2019.
The USMCA includes changes to provisions related to the automotive industry, agriculture, intellectual property, and digital trade. For instance, under the new agreement, a higher percentage of automobile parts must be made in North America to qualify for duty-free treatment. Additionally, the USMCA includes higher standards for labor and environmental protection, which proponents argue will lead to a more level playing field for workers in all three countries.
Many experts believe that the USMCA will have a positive impact on the US economy. For example, the International Trade Commission estimated that the agreement will add $68 billion to the US economy and create 176,000 new jobs. Additionally, the agreement is expected to increase US agricultural exports to Canada and Mexico.
While the USMCA has been hailed as a successful negotiation by the Trump administration, some critics have argued that the agreement does not go far enough in addressing concerns related to labor and environmental standards. Additionally, some lawmakers have expressed concerns about the enforceability of the agreement`s provisions.
Despite these criticisms, the USMCA represents a significant development in US trade policy and is likely to have a major impact on the economies of all three countries. As always, it will be important to closely monitor developments related to the agreement to assess its full impact on the US and global economy.