U.S., Canada and Mexico just reached a sweeping new NAFTA deal. Here's what's in it.
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Source: Washington Post
Here’s a rundown of what’s in the “new NAFTA.”
New name: Goodbye NAFTA. The new deal will be known as the United States-Mexico-Canada Agreement or USMCA. Trump, who had long disdained NAFTA, had suggested he might call it the “USMC,” in honor of the U.S. Marine Corps, but in the end, USMCA won out.
Big changes for cars. The goal of the new deal is to have more cars and truck parts made in North America. Starting in 2020, to qualify for zero tariffs, a car or truck must have 75 percent of its components manufactured in Canada, Mexico or the United States, a substantial boost from the current 62.5 percent requirement.
There’s also a new rule that a significant percentage of the work done on the car must be completed by workers earning at least $16 an hour, or about three times what the typical Mexican autoworker makes. Starting in 2020, cars and trucks should have at least 30 percent of the work on the vehicle done by worker earning $16 an hour. That gradually moves up to 40 percent for cars by 2023.
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Trump’s victory: Canada opens up its milk market to U.S. farmers. Trump tweeted often about how unfair he thought it was that Canada charged such high tariffs on U.S. dairy products. Canada has a complex milk and dairy system. To ensure Canadian dairy farmers don’t go bankrupt, the Canadian government restricts how much dairy can be produced in the country and how much foreign dairy can enter to keep milk prices high. Trump didn’t like that and dairy was a major sticking point in the negotiations.
Read more: https://www.washingtonpost.com/business/2018/10/01/us-canada-mexico-just-reached-sweeping-new-nafta-deal-heres-whats-it/?utm_term=.6e2818aa9e19
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