Senate passes US-Canada-Mexico trade deal, in major win for Trump

The US Senate overwhelmingly approved a new North American trade agreement Thursday that rewrites the rules of trade with Canada and Mexico and gives President Donald Trump a major policy win before senators turn their full attention to his impeachment trial. The vote was 89-10. The measure goes to Trump for his signature. It would replace the 25-year-old North American Free Trade Agreement, known as Nafta, which tore down most trade barriers and triggered a surge in trade. But Trump and other critics blamed that pact for encouraging US companies to move their manufacturing plants south of the border to take advantage of low-wage Mexican labourers. Passage of the trade bill came one day after Trump signed a new trade agreement with China, easing trade tensions between the economic powers. “Quite a week of substantive accomplishments for the nation, for the president and for our international trade,” said Senate Majority Leader Mitch McConnell, shortly before the vote on the US-Mexico-Canada deal. Trump campaigned in 2016 on ripping up trade deals that he said added to the nation’s trade deficit and cost the country manufacturing jobs. He promised he would rewrite Nafta if elected, a pact he described as “the worst trade deal in history”. He can now go to swing states such as Michigan, Pennsylvania and Wisconsin, and tell voters he followed through on that pledge. Canada takes first step towards ratifying new Nafta Mexico has approved the revised trade deal. Canada is expected to do so in coming months, with Prime Minister Justin Trudeau’s government long insisting it would wait for US approval before proceeding. Senator Pat Toomey, Republican of Pennsylvania, was a rare voice in speaking against the agreement. “It will mean higher prices for American consumers, who will have to pay more money for a car and therefore will have less money available for any of the other things they would like to consume,” Toomey said. “It will probably lead to an increase or acceleration in the shift to automation.” The agreement aims to have more cars produced in the United States, where workers earn an average of at least US$16 an hour. It also secured changes that require Mexico to change its laws to make it easier for workers to form independent unions, which should improve worker conditions and wages and reduce the incentive for US companies to relocate their plants. While the Trump administration completed its negotiations with Canada and Mexico more than a year ago, Democrats in the House of Representatives insisted on changes that they said made it more likely Mexico would follow through on its commitments. As part of those negotiations, the administration agreed to drop a provision that offered expensive biologic drugs – made from living cells – 10 years of protection from cheaper knock-off competition. The House voted 385 to 41 to approve the agreement last months. US and Canada reach last-minute deal to save Nafta, rename it USMCA Republicans and the president have complained about how long it took to complete the negotiations, but the talks resulted in a rare mix of support for the trade deal. The AFL-CIO, an association of trade unions, endorsed the measure, as did scores of business and farm groups. The biggest holdouts were environmental groups, which continue their opposition, saying the deal does not address climate change. Indeed, they contend the agreement would contribute to rising temperatures. “Despite the fact that it includes very good labour provisions, I am voting against USMCA because it does not address climate change, the greatest threat facing the planet,” said Senate Minority Leader Chuck Schumer.