Published: Fri, October 05, 2018
Economy | By

US, Canada in last-minute NAFTA deal

US, Canada in last-minute NAFTA deal

In a joint statement, USA and Canada said USMCA would "result in freer markets, fairer trade and robust economic growth in our region".

The agreement reached Sunday shows a give-and-take between the two countries: It gives USA farmers slightly greater access to the Canadian dairy market, but provides Canada protection if Trump goes ahead with plans to impose tariffs on cars and auto parts imported into the U.S.

The new deal, dubbed the US-Mexico-Canada Agreement, is expected to be signed by the leaders of the three member countries - US President Donald Trump, Canadian Prime Minister Justin Trudeau, and Mexican President Enrique Peña Nieto - in November. According to the U.S. Trade Representative, the agreement "address [es] unfair currency practices by requiring high-standard commitments to refrain from competitive devaluations and targeting exchange rates, while significantly increasing transparency and providing mechanisms for accountability".

That "representative" was Foreign Affairs Minister Chrystia Freeland - the senior cabinet minister leading Canada's trade delegation to rescue NAFTA from a president who won the White House in part by denouncing the agreement as one of the worst deals ever made. U.S. Rep. Elise M. Stefanik, R-Willsboro, praised negotiators from both nations for coming up with a plan to open Canadian markets to U.S. producers.

The agreement, reached on Sunday night, protects Canada's automotive industry from potentially devastating USA tariffs, but includes no assurance that Washington will lift punitive measures it imposed on Canadian and Mexican steel and aluminum in June. "This new agreement is significant, as it will keep our manufacturing supply chains strong throughout North America".

The president has adopted an "America First" policy and launched a trade war against China, as well as imposed tariffs on steel and aluminium imports from Mexico and Canada. And with that, after almost 14 months of tense negotiations, we now have a newly named regional trade agreement.

Those remarks set the stage for a bitter struggle over trade, with Trump threatening to drop Canada from the regional trade pact altogether if it didn't yield to key USA demands. Canadians were looking for a better deal, and instead, we seem to be getting a new name, but a worse deal. "Without tariffs, we wouldn't be talking about a deal". The portion of it most pertinent to dairy farmers in Northern New York, though, look very good.

"In the next few weeks, Canadians are expecting transparency from the Liberal government". Meanwhile, Canada and Mexico tend to be more focused on consumer protections.

In a copy of the letter Trump sent to the Speaker of the House of Representatives and to the President of the Senate, Trump said he meant to initiate trade negotiations with both countries, and enter the agreement by the end of November 2018, saying that "dramatic progress" has been made related to several areas.

Former prime minister Brian Mulroney, shown here earlier this year on Capitol Hill in Washington where he was telling the Senate Foreign Relations Committee about the benefits of NAFTA.

"We didn't ask to reopen NAFTA". That's why, from day one, we have offered our full support to our federal partner throughout the USMCA negotiation process to make sure a deal got done. "But based on reports, I am pleased that the deal includes a provision I pushed for to eliminate an unfair milk pricing system that has hurt NY dairy farmers' ability to export to Canada".

Trump has already imposed tariffs on Canadian aluminum and steel, citing national security, and is threatening similar punitive measures against auto exports.

Other key aspects include lengthening the patents on biologic pharmaceuticals by two years to 10 years from eight, and increasing the amount Canadians can spend online at US retailers without paying duty to $150 from $20.

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