What Is The New Usmca Agreement

The original NAFTA labour and environmental provisions were added in the form of subsidiary letters after the signing of the original agreement to win the support of Democrats and ensure the passage of the agreement under the Clinton administration. The U.S.M.C.A. defers these chapters to the main part of the trade agreement, which means that issues such as the right to organization are now subject to the normal procedures of the Dispute Settlement Pact. In addition to the original NAFTA provisions, the USMCA borrows significant credits under the Trans-Pacific Partnership (TPP) trade agreements and the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP). On April 3, 2020, Mexico announced its willingness to implement the agreement and joined Canada. [15] The agreement came into force on July 1, 2020. [16] [17] [19] [19] On December 19, 2019, the U.S. House of Representatives passed the USMCA with multi-party support by 385 votes (Democrats 193, Republicans 192) to 41 (Democracy 38, Republicans 2, 1). [79] On January 16, 2020, the U.S. Senate passed the trade agreement by 89 votes (Democrats 38, Republicans 51) to 10 (Democracy 8, Republican 1, Independent 1)[80] and the bill was forwarded to the White House for the signature of Donald Trump. [81] On January 29, 2020, Trump signed the agreement (Public Law No: 116-113). [82] NAFTA has been formally amended,[83] but not the 1989 Canada-U.S.

Free Trade Agreement, which is only “suspended.” [84] [85] On June 19, 2019, the Mexican Senate ratified the agreement (114 yes, 3 no, 3 abstentions). [88] Mexico`s ratification process will be completed when the President announces its ratification to the Federal Register. The United States, Mexico and Canada have reached an agreement to modernize NAFTA, which is 25 years old, into a high-level agreement of the 21st century. The new agreement between the United States and Mexico-Canada (USMCA) will support mutually beneficial trade, which will lead to freer markets, fairer trade and robust economic growth in North America. A new addition to the USMCA is the inclusion of Chapter 33, which covers macroeconomic policies and exchange rate issues. This is considered important because it could set a precedent for future trade agreements. [54] Chapter 33 sets out requirements for currency and macroeconomic transparency that, in the event of a breach, would be grounds for litigation under Chapter 20. [54] The United States, Canada and Mexico currently meet all of these transparency requirements in addition to substantive policy requirements that comply with the international Monetary Fund`s articles. [55] Fox News reported on December 9, 2019 that negotiators from the three countries reached an agreement on enforcement, paving the way for a final agreement within 24 hours and ratification by all three parties before the end of the year. Mexico has agreed to impose a minimum wage of $16 per hour for Mexican auto workers by a “neutral” third party. Mexico, which imports all of its aluminum, also objected to the provisions relating to the U.S. steel and aluminum content of automotive components.

[37] Under the leadership of President Donald J. Trump, the United States renegotiated the North American Free Trade Agreement and replaced it with an updated and rebalanced agreement that works much better for North America, the U.S.-Mexico-Canada Agreement (USMCA), which came into effect on July 1, 2020.