Mexico becomes first country to Ratify North American Trade Deal
Earlier this week Mexico became the first country to ratify the United States-Mexico- Canada Agreement (USMCA, or NAFTA 2.0) as it’s Senate voted overwhelmingly to approve the deal updating the rules for one of the world’s largest trade blocs.
Mexican President Andres Manuel Lopez Obrador described the ratification as “very good news” saying the treaty will be good for job creation, trade and foreign investment.
Mexico has been a strong proponent of the pact, which builds on NAFTA, the free-trade accord that has transformed the nation’s economy over the past 25 years. Mexico surpassed Canada to become the United States’ largest trading partner and market for American goods earlier this year. About $1.7 billion goods cross the United States-Mexico boarder daily in both directions.
The USMCA must now be ratified by the legislature of Canada and the United States. If approved by the two countries, the USMCA would replace the North American Free Trade Agreement (NAFTA), which Mr. Trump has threatened to withdraw from the United States from declaring it as “one of the worst trade deals every made”. Reacting to the news of the ratification being passed, Mr. Trump congratulated Obrador in a tweet on Wednesday stating US Congress needs to follow suit.
In Canada, Prime Minster Justin Trudeau pushes to get the deal through Parliminent, but the timing is tight. The ratification vote faces a tougher road in the United States as House speaker Nancy Pelosi (D- Calif.) has yet to set a date. Despite Trump’s decision to remove imposed tariffs on Mexico, removing one obstacle for Congress., Pelosi states that she has had concerns over enforcement tools, labor and environmental protections and provisions on pharmaceuticals.
While Congress debates whether or not to ratify USMCA, everyone from farmers, manufacturers to trade and trucking associations are urging politicians to approve the new trade deal.
Continue reading in the Washington Post here
Now what? Contact us to speak to our Customs Team.