Trump Signs USMCA Trade Deal; Replacing ‘Nightmare NAFTA’

January 29, 2020

President Trump signed the historic United States-Mexico-Canada Agreement into law on Wednesday, fulfilling a key campaign promise to revamped the North American free trade agreement.

“Today, we are finally ending the NAFTA nightmare and signing into law the brand new U.S.-Mexico-Canada Agreement,” Trump said in a ceremony event outside the South Lawn of the White House surrounded by workers, chief executives and lawmakers. “The USMCA is the largest, fairest, most balanced and modern trade agreement ever achieved. For the first time in American history, we have replaced a disastrous trade deal that rewarded outsourcing with a truly fair and reciprocal trade deal that will keep jobs, wealth, and growth right here in America.”

Replacing NAFTA, which Trump repeatedly called “the worst trade deal ever” during the 2016 campaign trail was one of Trump’s biggest campaign promise and helped him secure electoral victories in states that voted for Democrats in the last 25 years.

“Two decades of politicians ran for office vowing to replace the NAFTA,” Trump said. “Yet once elected, they never even tried. They never even gave it a shot. They sold out. But I’m not like those other politicians. I keep my promises, and I’m fighting for the American worker.”

Trump added, “This is something we really put our heart into. It’s probably the number one reason that I decided to lead this crazy life that I’m leading right now, as opposed to that beautiful, simple life of luxury that I lead before this happened.”

USMCA keeps most of the elements of NAFTA intact, but it requires 75 percent of automobile parts must be made in North America to be duty-free. It also adds component that 40-45 percent of automobile parts be made by workers who earn at least $16 an hour by 2023. The measures are meant to limit Mexico’s competitive advantage on labor costs, while expanding access to Canadian dairy markets for U.S. farmers and install a new regime of rules relating to digital trade.

At the ceremony, Trump hailed the “momentous, historic and joyous occasion” and said the deal would “create countless new American jobs” and prevent outsourcing.

“This is a colossal victory for our farmers, ranchers, energy workers, factory workers, and American workers in all 50 states,” the president said. “The USMCA is estimated to add another 1.2 percent to our GDP and create countless new American jobs. It will make our blue-collar boom even bigger, stronger, and more extraordinary, delivering massive gains for the loyal citizens of our nation.”

Vice President Pence and Senior adviser to the President, Ivanka Trump and Jared Kushner, and U.S. Trade Representative Robert Lighthizer were among the 400 guest in attendance for the cermony. A number of Republican lawmakers also attended the signing event, as Trump kicked off his remarks to recognize majority of those by name.

No Democrats were in attendance. White House spokesman Judd Deere said Democrats were invited but chose not to attend.

Democrats on Wednesday slammed the president for excluding them from a signing ceremony, taking credit for fixing the original version of the deal that Trump had presented.

“Because of the work of the House Democrats, under the leadership of Richie Neal with his task force, they made tremendous differences in what was proposed originally and what the president will be signing today,” Speaker Nancy Pelosi (D-CA) said at a morning news conference. “What the president will be signing is quite different from what the president sent us. We were able to make vast improvements. If we weren’t, we would not have been able to pass the bill.”

The U.S., Canada and Mexico reached an original agreement in December 2018, but it took more than a year of negotiations with Congress for the administration and lawmakers to reach an agreement that would pass. Pelosi unveiled last month changes to the USMCA deal just hours after announcing that the House would vote on articles of impeachment. The House passed the USMCA by 385-41 vote. Nearly a month later, the Senate passed it in a bipartisan vote 89-10.

The USMCA was supported by the AFL-CIO, one of the largest unions in the country, as well as leading business groups such as the U.S. Chamber of Commerce and Business Roundtable. However, many of the nation’s leading environmental organizations, including the Sierra Club and the League of Conservation Voters oppose the revised pact, citing it fails to address climate change.

The vast majority of the Democratic caucus, as well as most of the leading Democratic presidential candidates, backed the effort. Sen. Bernie Sanders (I-Vt.), who is seeking the Democratic presidential nomination, voted against the package, calling it a “disastrous deal ” because it doesn’t mention the words “climate change.”

“”The NAFTA 2.0 that Trump signed today is an absolute disaster,” Sanders said in a statement shortly after President Trump signed the deal. “In addition to doing nothing to stop the offshoring of jobs, the deal is a giveaway to the fossil fuel industry at a time when climate change threatens our planet. It does not even mention the words ‘climate change’, the most existential threat facing our planet.”

The signing of the USMCA comes nearly two weeks after Trump inked an initial trade deal with China. Combined, the two agreements encompass more than $2 trillion worth of trade and could add as much as 1.7 percentage points to U.S. economic growth

Mexico has ratified the deal, and is pending ratification in Canada, which is expected to happen in April.