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US, Canada, Mexico Sign Trade Deal, Trump Predicts Congress Approval

Published on Dec 1 2018 9:28 AM in Supply Chain tagged: USA / Canada / Mexico / trump / Trade Deal

US, Canada, Mexico Sign Trade Deal, Trump Predicts Congress Approval

The United States, Canada and Mexico signed a North American trade pact on Friday, and President Donald Trump predicted an easy passage through U.S. Congress to approve the deal, despite opposition from some lawmakers.

The three leaders agreed on a deal in principle to govern the more than trillion dollars of mutual trade after a year and a half of acrimonious negotiations concluded with a late-night bargain just an hour before a deadline on Sept. 30.

Since then, the three sides have bickered over the wording and the finer points of the deal and still had not agreed just hours before officials were due to sit down and sign it as the G20 summit kicks off in Buenos Aires.

"It’s been long and hard. We’ve taken a lot of barbs and a little abuse and we got there," Trump said.

Legislators from the three countries still have to approve the pact, officially known as the United States-Mexico-Canada Agreement (USMCA), before it goes into effect and replaces the North American Free Trade Agreement (NAFTA).

Trade Landscape

But the U.S. trade landscape will shift significantly in January when Democrats take control of the U.S. House of Representatives after winning midterm elections in November. House Democratic Speaker Nancy Pelosi, has pledged to "closely scrutinise" the new pact.

However, Trump and U.S. Trade Representative Lightizer said they were confident the agreement would pass Congress.

"This was negotiated from the beginning to be a bipartisan agreement.... I think we’ll get the support of a lot of Democrats," he told reporters.

Canadian Prime Minister Justin Trudeau's spokesman only confirmed his attendance late on Thursday. Before signing the deal he continued to refer to as the new NAFTA, Trudeau told Trump the two should continue to work together to eliminate steel and aluminium tariffs.

Mexico's President Enrique Pena Nieto joined the ceremony on his last day in office.

Trump had vowed to revamp NAFTA during his 2016 presidential election campaign. He threatened to tear it up and withdraw the U.S. completely at times during the negotiation, which would have left trade between the three neighbours in disarray.

Trump forced Canada and Mexico to renegotiate the 24-year-old agreement because he said the existing pact encouraged U.S. companies to move jobs to low-wage Mexico.

U.S. objections to Canada's protected internal market for dairy products was a major challenge facing negotiators during the talks, and Trump repeatedly demanded concessions and accused Canada of hurting U.S. farmers.

BDI, Germany's main industry association, said in a statement the agreement's rules on preferential origin for the automotive sector would be stricter and more complex, calling it "a retrograde step compared with NAFTA."

News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.

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