The Presidents of Mexico, the United States and the Prime Minister of Canada signed the new North American Free Trade Agreement on Friday at an official ceremony on the sidelines of the G20 in Buenos Aires.
Concluded on September 30 after laborious negotiations, the new agreement is called the “United States-Mexico-Canada Agreement” (USMCA – United States-Mexico-Canada Agreement). It replaces the North American Free Trade Agreement Alena, which dated back to 1994.
Trade agreement can not remain static, they must evolve according to the evolution of the economy and the needs of society, said the Mexican President Enrique Peña Nieto during the signing ceremony of this agreement.
“This is a model free trade agreement that will change the business landscape forever,” said President Donald Trump in the wake of the bitterly negotiated treaty between the three countries on his own initiative.
The negotiators of the three countries had reached an agreement after a marathon of discussions started in early September. The three parties finally reached a compromise on a number of difficult issues, particularly on the automobile and agriculture.
One of the most important aspects concerns the automotive sector which has been totally revolutionized by the Alena. The new text provides rules for sourcing materials and components in the United States and North America. It also provides for a provision forcing Mexico to raise sector wages to narrow the gap with better paid northern neighbors.
Some 2.6 million vehicles assembled in Canada are exempt from US customs.