G20 summit: Trump, Trudeau and Enrique Pena sign US-Mexico–Canada Agreement, replace NAFTA

WION Web Team
Buenos Aires, Argentina Published: Nov 30, 2018, 06:34 PM(IST)

Trump, Trudeau and Mexican President Enrique Pena Nieto sign USMCA Photograph:( AFP )

Story highlights

Canada, Mexico and the United States had reached the deal on September 30th.

US President Trump, Canadian Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto took part in the signing ceremony to approve the Mexico–Canada Agreement (USMCA) in Buenos Aires today ahead of the G20 summit.


The deal came about after over a year of negotiations between all three parties aimed at replacing the North American Free Trade Agreement(NAFTA). Canada had reached a deal at the last minute in September, Mexico had already struck a deal with the US earlier.

President Trump had personally pushed for the deal, however, it wasn't without its bottlenecks. Canadian Prime Minister Justin Trudeau had said working with Trump was "not always simple," during the renegotiation stage.

Mexican President-elect Andres Manuel Lopez Obrador had said he was putting Mexico first, saying the deal would be known in Spanish as "T-MEC," after conducting a poll of his Twitter followers.

"T-MEC stands for "Tratado Mexico-Estados Unidos-Canada" which translates as the Mexico-United States-Canada Treaty. More than 102,000 people participated in the poll on the social media site.

Canada, Mexico and the United States had reached the deal on September 30th.

The deal has made sweeping changes in manufacturing and labour requirements in the auto sector. According to the new deal, 75 per cent of auto content be made in the region, increased from 62.5 per cent, and that 40-45 per cent be made by workers earning at least $16 an hour.

Mexico, in turn, agreed to continue to recognise US auto safety standards. USMCA exempts Mexico and Canada autos up to a threshold of 2.6 million vehicles a year, including light trucks.

Canada on its part agreed to open its borders wider to American milk, cheese, cream, butter and other goods and allowed greater import of US chicken, eggs and turkey. The US agreed to keep Canada's demand for keeping Chapter 19 which involves the dispute settlement system.

Under the new agreement, the signatories also allowed equal copyright treatment for writers, composers and others from member countries.

The new agreement also prohibited customs duties for digitally distributed goods namely software and games, e-books, music and movies. 

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