U.S. And Canada Reach Deal To Replace NAFTA | WBEZ
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U.S. And Canada Reach Deal To Replace NAFTA

Updated at 7:45 a.m. ET

The U.S. and Canada reached a deal to replace the North American Free Trade Agreement, signed a quarter-century ago, with a new pact that the Trump administration says is easier to enforce.

Ahead of the midnight deadline set by the White House, President Trump approved changes that essentially revamp the 1993 NAFTA deal, bringing Canada on board after Mexico had already agreed in August.

In addition, the two countries agreed to shield Canada from automobile tariffs imposed by the U.S.

The agreement, called the U.S. Mexico Canada Agreement, or USMCA, includes a quota on automobile shipments to the U.S. and a greater level of access to Canada's dairy market. Steel and aluminum tariffs would remain in place, subject to future negotiation.

A senior administration official, who asked not to be named, tells the Post that the deal includes better protection for labor rights, the environment and intellectual property than trade deals made under the Obama administration.

The Times reports that Canadian Prime Minister Justin Trudeau attended a Cabinet meeting at 10 p.m. in Ottawa to discuss the details of the deal with senior White House adviser Jared Kushner and Robert E. Lighthizer, the president's top negotiator.

Juan Carlos Baker, Mexico's under secretary of foreign trade, is expected to present the details of the agreement to the Mexican senate, according to the Times.

A joint statement from Lighthizer and Chrystia Freeland says, "USMCA will give our workers, farmers, ranchers, and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region."

With limited details on what USMCA entails, the Times reports that with the new agreement, Canada's dairy management system will ease its protections, allowing the U.S. more access to Canada's dairy products.

Dan Ujczo, a trade lawyer with Dickinson Wright, tells the Post, "the heavy lift is going to be getting a trade deal through the next Congress in 2019 as well as ratification by Mexico's new Congress and in Canada during federal election year."

Following years of threats from Trump and the promise of establishing a new deal more favorable to the U.S., the latest agreement appears to represent a win for the White House.

Peter Navarro, White House trade adviser, said on Sunday Morning Futures, that the goal for the agreement is to restore "North America as a manufacturing powerhouse."

The new deal must now go to Congress for approval, with a vote not expected until next year, after midterm elections.

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