Senate Approves US-Canada-Mexico Trade Deal

The Senate overwhelmingly passed with bi-partisan support a new North American trade deal in what is seen as a major victory for President Donald Trump, who made replacing NAFTA one of his key campaign promises.

The United States-Mexico-Canada Agreement, or the USMCA, was passed in the Upper House by a vote of 89-10 Thursday.

The deal was passed by the House Of Representatives last month by a 385-41 vote after some changes that the Democrats proposed were accepted by the Trump administration.

Democrats claimed changes to the agreement will bolster America’s economy, support workers, protect the environment, and improve access to affordable prescription drugs. The U.S. ratification of the tri-lateral agreement will be complete after Trump signs it.

The White House said the new deal will replace “the job-killing, huge failure NAFTA – fulfilling a core promise the President made to the American people”. USMCA, which the President successfully negotiated over a year ago, rebalances trade between the three countries and will lead to significant economic and job growth in the United States, the Press Secretary said in a statement.

Senate Majority leader Mitch McConnell said he is grateful to the President for prioritizing this deal and delivering on his major promise. “It’s a big win for Kentucky and for American families in all 50 states,” he said on Twitter.

“It is the first agreement with strong, enforceable disciplines against unfair, market distorting subsidies and currency manipulation”, according to United States Trade Representative Robert Lighthizer.

USMCA, which replaces the 26-year-old North American Free Trade Agreement (NAFTA), was signed by the three countries in November 2018 after several rounds of tough negotiations.

The deal requires that cars should be manufactured with 75 percent North American components to escape tariffs. Forty percent of each car must also be made in facilities where workers earn $16 an hour or more on average. Reciprocally, Canada has opened the door to its dairy markets for American farmers.

USMCA includes a section covering labor provisions. It aims to improve workers’ rights by granting the U.S. new enforcement authorities and holding Mexico accountable for improving workers’ rights.

Trade experts say USMCA could be the forerunner to an economic and trade alliance against China. Mexico ratified the North American trade agreement in June last year.

The USMCA is subject to ratification by the Canadian parliament for it to come into force.

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