Donald Trump celebrates Nafta replacement as ‘historic’ trade agreement with Canada and Mexico
The agreement largely spared Canada and Mexico from threatened auto tariffs, which the Trump administration is still studying; the deal could score political points for Trump ahead of the midterm elections in November
US President Donald Trump celebrated a trade deal with Canada and Mexico to replace Nafta as a “historic” win that vindicated his strategy of threatening tariffs on trade partners.
Trump called the accord “the most important trade deal we’ve ever made by far”. He predicted the renamed US-Mexico-Canada Agreement, or USMCA, would “easily” pass Congress after he signs it by late November.
The new agreement makes modest revisions to a trade deal Trump once called a “disaster”, easing uncertainty for companies reliant on tariff-free commerce among the three countries.
US stocks climbed on Monday toward records, while the Canadian dollar and the Mexican peso gained.
Trump cited in particular provisions governing automobiles, raising the portion of their content that must originate within the region to 75 per cent, from 62.5 per cent, and requiring at least 40 per cent of a car to come from workers whose pay averages more than US$16 per hour. The president called those rules “the most important thing” for him.
“We will be manufacturing many more cars,” Trump said. “And our companies won’t be leaving the United States, firing their workers and building their cars elsewhere. They no longer have that incentive.”
Trump also called the agreement “a very, very big deal for our farmers”. He said the US negotiated more favourable terms for exporting dairy and produce.