By Agence France-Presse
President Donald Trump on Monday hailed a US trade pact with Canada and Mexico, which replaces the old NAFTA deal, as a historic agreement set to turn North America back into a “manufacturing powerhouse” and fuel US economic expansion.
Governing almost $1.2 trillion in trade, the pact known as the United States-Mexico-Canada Agreement, or USMCA, is “the most important trade deal we’ve ever made by far,” Trump told a White House press conference.
The agreement first announced late Sunday, just before a midnight deadline, ended more than a year of tense negotiations sparked by Trump’s decision to scrap the quarter-century old North American Free Trade Agreement.
Trump’s aggressive tearing up of long-standing US trade deals — with everyone from its two huge neighbors to China and the European Union — has rattled world leaders and sparked fears of economic turmoil.
But in a buoyant performance at his Rose Garden news conference, Trump said the approach of using harsh tariffs to force countries into renegotiating unfair deals had been vindicated.
“The United States in its trade deals has lost on average almost $800 billion a year. That’s dealing with China, dealing with European Union, with everybody, Japan, Mexico, Canada, everybody,” he said.
“We’re not going to allow that to happen.”
USMCA is said by analysts to be similar to NAFTA in many respects but there is improved access for US agricultural goods, including the dairy products which Canada in particular had tried to limit.
New rules are designed to improve US auto workers’ competitiveness, with 40 percent of each car required to have been made by people earning at least $16 an hour. The US had also sought increased American content for duty-free autos.
Trump said the new framework will encourage US companies to hire at home, rather than look abroad.
“It will transform North America back into a manufacturing powerhouse,” he said. USMCA will “allow us to reclaim a supply chain that has been off-shored to the world because of unfair trade issues.”
Mexican President-elect Andres Manuel Lopez Obrador has embraced the new deal, his incoming foreign minister said.
“It will allow us to maintain the competitiveness of the Mexican manufacturing industry, which will keep its access to the world’s largest market,” Marcelo Ebrard told a press conference.
Canadian Prime Minister Justin Trudeau faces anger from dairy farmers but told journalists Monday that the deal overall would be “profoundly beneficial for our economy” and “the most important progressive reform for North American workers in a generation.”
Stock markets rose on news of the agreement, with the Dow Jones in New York up 1.0 percent in late morning, just shy of a record high.