The agreement between the United States, Mexico and Canada is based on the North American Free Trade Agreement (NAFTA), which entered into force on January 1, 1994. This Agreement has been the result of more than a year of negotiations, including possible U.S. tariffs against Canada and the possibility of separate bilateral agreements.  On April 3, 2020, Canada informed the United States and Mexico that it had completed its process of domestic ratification of the Agreement.  On March 1, 2019, many organizations representing the agricultural sector in the United States announced their support for the USMCA and asked Congress to ratify the agreement. They also called on the Trump administration to maintain NAFTA until the new trade agreement is ratified.  On the 4th However, House Ways and Means president Richard Neal predicted a “very difficult” path through Congress for the deal.  Beginning March 7, senior White House officials met with members of the House Ways and Means as well as moderate caucuses from both sides, such as the Solvers Caucus, the Tuesday Group, and the Blue Dog Coalition, to gain support for ratification. The Trump administration has also withdrawn from the threat to withdraw from nafta, as negotiations with Congress continue.  The renegotiated agreement contains a chapter on macroeconomic policies and exchange rate issues, with new political and transparency commitments in monetary matters. The chapter will address unfair monetary practices by requiring high obligations in the absence of competitive devaluations and exchange rates, while significantly enhancing transparency and putting in place accountability mechanisms. This approach is unprecedented in the context of a trade agreement and will contribute to strengthening macroeconomic and exchange rate stability.
Fox News reported on December 9, 2019 that negotiators from the three countries have reached an agreement on implementation, paving the way for a final agreement within 24 hours and ratification by all three sides before the end of the year. Mexico has agreed to the imposition of a $16 per hour minimum wage for Mexican autoworkers by a “neutral” third party. Mexico, which imports all of its aluminum, has also objected to the provisions on U.S. steel and aluminum content in automotive components.  The Government of Canada noted that the “CUSMA outcomes preserve key elements of the long-term trading relationship and contain new and updated provisions to address twenty-first century trade issues and promote opportunities.” The agreement between the United States, Mexico and Canada (“USMCA” in the United States, “CUSMA” in Canada and “T-MEC” in Mexico) entered into force on July 1, 2020. The trade agreement between the three countries replaces the North American Free Trade Agreement (NAFTA). The Environment Chapter contains the most enforceable environmental obligations of all previous U.S. agreements, including commitments to combat trade in wildlife, timber, and fish; strengthen law enforcement networks to curb trafficking in human beings; and address pressing environmental issues such as air quality and marine litter. The United States, Mexico and Canada have reached an agreement to modernize the 25-year-old NAFTA into a high-level agreement of the twenty-first century. . . .