Hossen Sohel
Canada and the US reached a deadline deal on a new free trade pact that will include Mexico, the governments announced late Sunday, after more than a year of talks to revamp a pact President Donald Trump had labeled a disaster, reports AFP. The United States-Mexico-Canada Agreement (USMCA) updates and replaces the nearly 25-year-old North American Free Trade Agreement (NAFTA), which Trump had threatened to cancel.
The rewrite “will result in freer markets, fairer trade and robust economic growth in our region,” said a joint statement from US Trade Representative Robert Lighthizer and Canada’s Foreign Affairs Minister Chrystia Freeland.
Sunday’s announcement capped six weeks of intense discussions.
In the end, the governments overcame their differences with both sides conceding some ground, and hailing the agreement for a region of 500 million residents that conducts about $1 trillion in trade a year.
“It’s a good day for Canada,” Canadian Prime Minister Justin Trudeau said, while Mexican Foreign Minister Luis Videgaray tweeted the deal was good for his country “and for North America.”
The political stakes were high.
Trump, who pursues an “America First” policy on trade, needs to look strong heading into the November midterm elections where his Republican Party is fighting to keep control of Congress, while Trudeau does not want to be seen as caving before next year’s general election north of the border.
Canada had risked being frozen out of a US-Mexican deal reached in August.
The Canadian dollar jumped Monday to a five-month high in Asian trade after reports of the deal.
At around 11:00 am in Tokyo (0200 GMT), the loonie was up 0.7 percent from its Friday close at 1.2814 to one US dollar.