US, Mexico and Canada sign revised trade deal to replace Nafta

https://www.theguardian.com/us-news/2019/dec/10/us-mexico-canada-trade-deal-nafta

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Pact was agreed more than a year ago but Democrats insisted on major changes to improve enforcement of worker rights

Officials from Canada, Mexico and the United States have signed a fresh overhaul of a quarter-century-old trade pact that aims to improve enforcement of worker rights and hold down prices for biologic drugs by eliminating a patent provision.

The signing ceremony in Mexico City launched what may be the final approval effort for Donald Trump’s three-year quest to revamp the 1994 North American Free Trade Agreement (Nafta), a deal he has blamed for the loss of millions of US manufacturing jobs.

The event was attended by Mexico’s president, Andrés Manuel López Obrador, Canada’s deputy prime minister, Chrystia Freeland, the US trade representative, Robert Lighthizer, and Trump’s son-in-law, Jared Kushner.

The result of a rare show of bipartisan and cross-border cooperation in the Trump era of global trade conflicts, the deal was inked the same day as he became the fourth US president in history to face formal impeachment.

Lighthizer called it “a miracle” that actors from across the political spectrum had come together, calling it a testament to the benefits of the deal. López Obrador credited Trump for working with him, while Freeland celebrated a win for multilateralism.

“We have accomplished this together at a moment when, around the world, it is increasingly difficult to get trade deals done,” she said.

The US-Mexico-Canada Agreement (USMCA) was signed more than a year ago to replace Nafta, but Democrats controlling the US House of Representatives insisted on major changes to labor and environmental enforcement before bringing it to a vote.

Intense negotiations over the past week among Democrats, the Trump administration and Mexico produced more stringent rules on labor rights aimed at reducing Mexico’s low-wage advantage, including verification of labor compliance by independent labor experts.

“It is infinitely better than what was initially proposed by the administration,” said the House speaker, Nancy Pelosi.

Some Mexican business groups fear that López Obrador and his chief negotiator, the deputy foreign minister, Jesús Seade, have ceded too much, and call the labor verification a violation of Mexican sovereignty.

Seade himself, who signed the deal on Tuesday, said some of the changes were reasonable but not necessarily “good for Mexico”.

Republican and Democratic US lawmakers say there is broad support for revising the trade pact, which encompasses $1.2tn in annual trade across the continent and supports 12m US jobs and a third of American agricultural exports, backers say.

The House ways and means committee chairman, Richard Neal, a Democrat, said he saw no reason for “unnecessary delays” in bringing the trade pact to a vote on the House floor.

However, the majority leader, Mitch McConnell, said the Republican-controlled Senate would not take up the deal before congressional recess, potentially pushing the vote into next year.

Trump launched a renegotiation of Nafta in his first year in office, intent on delivering on his 2016 campaign promise to replace what he has derided as the “worst deal ever”. Canadian and Mexican leaders reluctantly agreed to join the negotiations with their largest trading partner.

“America’s great USMCA Trade Bill is looking good. It will be the best and most important trade deal ever made by the USA. Good for everybody,” Trump tweeted on Tuesday. “Importantly, we will finally end our Country’s worst Trade Deal, NAFTA!”