Trump Hails ‘Terrific’ Trade Deal with Canada, Mexico

VOA/Steve Herman

It is the biggest-ever and the best trade deal in the world – that’s how U.S. President Donald Trump and members of his administration are touting a new trade pact they have reached with neighbors Canada and Mexico.

“This landmark agreement will send cash and jobs pouring into the United States and into North America,” predicted Trump.

After intense last-minute discussions just ahead of a self-imposed Sunday midnight deadline, the United States and Canada announced they had reached a deal, allowing a modified three-way pact with Mexico to replace the nearly quarter-century-old North American Free Trade Agreement (NAFTA).

«This is a terrific deal for all of us,» Trump said in a victory speech in the White House Rose Garden where he was surrounded by several members of his Cabinet and his trade negotiators who had worked to achieve the United States-Mexico-Canada Agreement (USMCA).

The pact, underpinning $1.2 trillion in annual trade, is based on “fairness and reciprocity,” according to Trump, who added that it was reached after disagreements with his counterparts in Mexico City and Ottawa, Enrique Pena Nieto and Justin Trudeau.

Trump said he spoke to both leaders on Monday.

‘Most competitive’

The agreement will consolidate the North American region “as one of the most competitive in the world,” according to the Mexican president on Twitter.

“This deal makes our partnership even stronger and benefits people across North America,” Trudeau tweeted.

The pact is expected to be signed in 60 days by the three leaders, possibly at the Group of 20 (G-20) summit in late November in Argentina.

Foreign outsourcing for U.S. automotive production will be reduced under the deal, said Trump, who predicted «once USMCA is approved, it will be a new dawn for the U.S. auto industry and the U.S. auto worker,» turning the country again into “a manufacturing powerhouse.”

While the president told reporters that he is “not at all confident” Congress – which could see the House back under control of the opposition Democrats after the November midterm elections — will approve the deal, other members of his administration are expressing greater optimism.

“There could be Democratic support for this” as it contains provisions favorable to American labor – a traditional backer of the Democratic Party, National Economic Council Director Larry Kudlow tells VOA.

“I think it’s going to pass with a substantial majority,” predicts U.S. Trade Representative Robert Lighthizer. “This is not a Republican-only agreement. It was not designed to be a Republican-only agreement. There are really no poison pills in here for Democrats.”

“Democrats will closely scrutinize the text of the Trump administration’s NAFTA proposal and look forward to further analyses and conversations with stakeholders,” House Minority Leader Nancy Pelosi said in a statement.

Trump had made criticism of NAFTA a centerpiece of his successful 2016 election campaign, terming it the worst trade deal in history and blaming NAFTA for the loss of American manufacturing jobs since it went into effect in 1994.

The U.S. agreement with Ottawa will boost American access to Canada’s dairy market – with some concessions on its heavily protected supply management system — while shielding the Canadians from possible U.S. auto tariffs.

Steel and aluminum tariffs imposed by Washington, however, will remain. Canada had demanded protection from Trump’s tariffs on imported steel and aluminum.

“For those babies out there who keep talking about tariffs,” this deal would not have happened without tariffs, Trump told reporters during a nearly 80-minute event in the White House Rose Garden.

The metal tariffs discussions are on a “completely separate track,” according to a senior U.S. official.

In a big victory for Canada, NAFTA’s Chapter 19 dispute resolution system, which involves anti-dumping and countervailing decisions, will remain intact.

‘Deadline was real’

The Trump administration had imposed a midnight Sunday deadline for Trudeau’s government to reach agreement on an updated NAFTA or face exclusion from the treaty.

“This deadline was real,” according to a senior U.S. official. “We ended up in a good place that we ultimately think is a good deal for all three countries.”

U.S. officials, in recent weeks, had been adamant that the text for a new deal – whether it would only be with Mexico or also include Canada – to be released by September 30 to meet congressional notification requirements and to allow outgoing Mexican President Pena Nieto to be able to sign the deal before he is succeeded by Andres Manuel Lopez Obrador, a left-wing populist.

Canada’s government had faced strong opposition to elements of the revised pact from the country’s dairy farmers. Voters in Quebec, home to 354,000 dairy cows – the most of any province — head to the polls for provincial elections Monday, which cast a shadow over the last-minute negotiations.

The National Association of Manufacturers (NAM) in the United States declared itself “extremely encouraged” by initial details of the new three-way pact.

“As we review the agreement text, we will be looking to ensure that this deal opens markets, raises standards, provides enforcement and modernizes trade rules so that manufacturers across the United States can grow our economy,” NAM President and Chief Executive Officer Jay Timmons said.

“This administration is committed to strong and effective enforcement of this agreement,” a senior U.S. official told reporters. “This is not going to just be words on paper. This is real.”

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