How the new USMCA deal will affect you

Oct 05, 2018, 02:49
How the new USMCA deal will affect you

On Sunday, a senior Trump administration official said the new deal, which effectively replaces the North American Free Trade Agreement, would allow the White House to focus its attention on China.

Trump said he would sign the final agreement in late November, in about 60 days, and the pact is expected to be signed by Trudeau and outgoing Mexican President Enrique Pena Nieto before he leaves office December 1.

The new agreement ends the discriminatory pricing and restricts Canadian exports of dairy powders. The U.S. -Mexico-Canada Agreement, as the new Nafta is known, still needs to be ratified by the U.S. Congress and other legislatures before coming into force.

Hall Findlay said the Class 7 concessions, combined with wider access to the dairy market for USA firms, will restrict the ability of Canadian firms to compete globally.

Canada's tariffs of more than 200 per cent on various other dairy items - milk, cream, cheese, butter - will remain the same as they were, a Canadian government official confirmed on Thursday. "An integrated North American market, which this new USMCA continues, is critical to Washington state businesses, farmers, ranchers and workers", WCIT President Lori Otto Punke said in a statement. Still, a good enough deal is better than no deal.

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"It is a great deal for all three countries, solves the many deficiencies and mistakes in NAFTA, greatly opens markets to our Farmers and Manufacturers, reduce Trade Barriers to the US and will bring all three Great Nations closer together in competition with the rest of the world", Trump wrote on Twitter on Monday. China's tariffs are on U.S. soy, corn, cars, motorbikes and other products.

Canadian Foreign Minister Chrystia Freeland on Monday downplayed the importance of the provision, saying the countries could always terminate the agreement if they wanted to.

Provisions aimed at ensuring more cars and auto parts are made in North America - especially the US - will force some manufacturers to change their pattern of manufacturing, which could prove costly.

For now, USA steel and aluminum tariffs on Canada and Mexico remain in place subject to future talks but these are likely to be resolved.

Trump has used US tariffs on billions of dollars' worth of imported goods from China and other nations as a negotiating tactic and said the North American deal offered evidence that his approach was working.

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Guajardo, the former Mexican ambassador, said there is a growing recognition in Beijing - and Washington - that the Trump administration has engaged in trade disputes with many countries but that there's been a far more profound struggle with China.

"This deadline was real", according to a senior USA official.

"If I tell you that you are going to lose some of your business, you do not want to wait five years to find out what you are going to have as compensation to be able to manage your finances and knowing where you are investing", Bachand said.

It was also "the biggest trade deal in the United States history", he told a press conference. But Trump and other critics said it encouraged manufacturers to move south of the border to take advantage of low-wage Mexican wages, costing American jobs. Alabama automakers have rebuilt our state economy over the past 20 years, but this agreement could potentially wind up incentivizing them to shift production outside of North America.

"It's super depressing that dairies that were forced out of the market earlier won't get to necessarily reap the benefits of this, but we're super excited for us as individuals, but also because we're a family dairy, there looks to be a future for our children", Elsinger said.

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By settling on a deal with America's neighbours - and beginning talks with allies Japan and the European Union - Mr Trump is strengthening his negotiating position vis-a-vis strategic competitor Beijing.