USMCA: Agreement reached on Nafta trade deal replacement


The USMCA was signed in November 2018, after more than a year of negotiations to update the countries' original trade deal, the 25-year-old North American Free Trade Agreement (NAFTA), which Trump complains has been "a disaster" for the US.

But US House Speaker Nancy Pelosi - the Democrat needed to move the agreement forward - and American labor unions gave their blessing to the final deal.

House Speaker Nancy Pelosi of Calif., accompanied by Chairman of the House Ways and Means Committee Richard Neal, D-Mass., left, speaks at a news conference to discuss the United States Mexico Canada Agreement (USMCA) trade agreement, Tuesday, Dec. 10, 2019, on Capitol Hill in Washington.

Some in Chinese policy circles who thought Trump might seek a quick trade deal have also anxious that Democrats would seek to pressure the White House out of reaching an agreement. "There's a general agreement - not total agreement, it's not unanimity - that USMCA is better".

They say Mr. Trump leveraged a White House meeting and almost $400 million in military assistance to pressure the Ukrainian president to open investigations of political rival and former Vice President Joseph R. Biden and his son Hunter.

"For the first time, there truly will be enforceable labor standards", including inspections of factories, said Richard Trumka, the federation's president, whose endorsement will be crucial to boosting the deal's support in Congress. Major U.S. stock indexes turned positive after the announcement.

In Washington, the Democrats - acutely aware of the need to win back blue-collar voters they lost to Trump in 2016 - insisted on greater oversight of Mexico's promised labor reforms.

In addition to the labor provisions, Democrats said they won elimination of a 10-year data exclusivity period for biologic drugs from the agreement, which they feared would lead to higher US drug prices.

For Democrats, the deal serves as a retort to Trump's and Republicans' assertions that their only agenda was pursuing his impeachment.

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But the trade deal highlighted how much more Trump could have accomplished "had he stuck to the national agenda", Gergen said.

Pelosi did say Democrats are hoping to get moving before the end of the congressional session on December 20. "And there's some people who said 'why make it look like he has a victory.' We're declaring a victory for the American worker", she said.

The proposed USMCA deal contains provisions created to lure manufacturers back to the U.S.

Mexico's President, Andres Manuel Lopez Obrador, said representatives would sign an amended pact in Mexico on Tuesday.

Mexico passed a law earlier this year that requires labor courts so that disputes are no longer just settled by the nation's labor agency. "It is infinitely better than what was initially proposed by the administration".

They also have pressed for removal of a provision that grants big internet services providers liability protections for third party content, and are seeking to relax data protections for biologic drugs that they fear will mean higher drug prices.

"There are serious problems with this agreement, " Pennsylvania Republican Sen. Pat Toomey offered a rare GOP voice against the accord, which he said veered to the left and "undermines the free flow of capital" from the its trading partners.

Neal said the negotiations with the administration were "tough".

But Vice-President Mike Pence released a statement praising Trump's leadership and claiming Democrats "have finally acquiesced" in allowing a vote on the trade pact. Pelosi said. "Once we go down that path we'll be OK".