WASHINGTON (CN) — President Donald Trump this week officially signed the new trade agreement between the U.S., Mexico and Canada, finalizing a deal that overhauls labor, environmental and intellectual property rules.
The Senate voted 89-10 two weeks ago to send the deal to the president’s desk. It was first signed in November 2018 by Trump, Canadian Prime Minister Justin Trudeau and then-Mexican President Enrique Pena Nieto, but hit roadblocks in Congress.
House Democrats cited issues with labor parameters in that draft and only signed off on the deal last month after negotiating those aspects, along with provisions on the environment and intellectual property.
Referring to the North American Free Trade Agreement, Trump said during a signing event Wednesday that his administration was ending the “NAFTA nightmare” by implementing its replacement, referred to as the USMCA.
He said the new deal is “a colossal victory for our farmers, ranchers, energy workers, factory workers and American workers.”
“The USMCA is estimated to add another 1.2% to our GDP and create countless American jobs. It will make our blue collar boom, which is beyond anybody’s expectations, even bigger, stronger and more extraordinary, delivering massive gains for the loyal citizens of our nation,” Trump said.
Trump also thanked a myriad of Republican lawmakers in attendance, including Senators Steve Daines of Montana, John Cornyn of Texas and Joni Ernst of Iowa, as well as House Minority Leader Kevin McCarthy of California.
“Maybe I’m being just nice to them because I want their vote, does that make sense? I don’t want to leave anybody out,” the president said, apparently referring to his ongoing impeachment trial in the Senate.
The previous trade agreement, NAFTA, dissolved the majority of trade barriers between the United States, Mexico and Canada. President Trump and many Democratic lawmakers alike have said it incentivized U.S. companies to move their factories to Mexico where they could exploit low-cost laborers and then ship their products back without tax.
The USMCA, by contrast, is considered pro-labor. Among other measures, Mexico is required to make it easier for workers to unionize, with the aim of boosting wages so the country is less attractive for U.S. companies to move factories south.
Automobiles will qualify for zero tariffs if 75% of their parts were made in Mexico, the U.S. and Canada, which is an increase from 62.5% under NAFTA. Additionally, 40% of car parts are required to be made by workers making at least $16 an hour by 2023.
The agreement also includes provisions on intellectual property, extending the copyright length from 50 to 70 years after the author’s death. Environmental provisions are aimed at protecting marine wildlife from overfishing and pollution.
Another provision of the deal will see Canada importing more American dairy products, which Trump pushed for heavily to give a boost to U.S. farmers.