I kept hearing how this was no big change so I thought I would research it a little bit. Found some unbiased reviews of differences and thought I would post for those interested.
Please pass the butter
Since 1994, the U.S. and Canada have dropped tariffs and other trade restrictions on most agricultural products. But there were a few exceptions, most notably dairy.
Dairy was a particularly problematic sticking point in year-long negotiations between the three countries. The U.S. and Canada both have long histories of protectionist policies, such as subsidizing dairy farmers and setting import quotas on milk. Canadian tariffs on some products can be as high as 300%.
The new USMCA begins to change that, representing a small but important win for both countries, especially the U.S.
Under the new accord, Canada will curb some of the ways it protects its dairy industry, such as allowing more American milk, butter, cheese and other dairy products to enter Canada duty-free, with reciprocal treatment for Canadian dairy exports to the U.S.
Made in North America
The new agreement also made big changes for auto manufacturers in hopes of ensuring more vehicles and parts are made in North America.
Starting as early as 2020, to qualify for zero tariffs when crossing borders, a car or truck must have 75% of its components manufactured in Canada, the U.S. or Mexico, up from 62.5% currently.
Even more noteworthy, negotiators agreed to a new requirement that 40% to 45% of a vehicle’s components must be made by workers earning at least US$16 per hour, which is about three times more than the average wage currently earned by Mexican auto workers.
This change is huge, particularly for low-paid workers in Mexico. But it may lead to challenges over the enforcement of labor laws and increase the cost of cars made in all three countries.
~ This is what they said would occur in the first NAFTA which did not happen. Remember our leaders telling us it would improve the living conditions of Mexican border towns? All it did was reduce make our border towns look like theirs.
Keeping up with the times
Society has experienced significant technological changes since NAFTA was implemented in 1994. Back then, the internet was still in its infancy, while smartphones and self-driving cars were barely imaginable.
That’s why modernization – updating rules and standards to keep up with the times – is a critical and positive update to the trade deal tying the North American continent together.
While NAFTA was the first trade treaty to include intellectual property protections, the high pace of innovation has made modernization of its provisions imperative.
The new agreement includes stronger protections for patents and trademarks in areas such as biotech, financial services and domain names – all of which have advanced considerably over the past quarter-century. It also contains new provisions governing the expansion of digital trade and investment in innovative products and services.
Separately, negotiators agreed to update labor and environmental standards, which were not central to the 1994 accord and are now typical in modern trade agreements. Examples include enforcing a minimum wage for autoworkers, stricter environmental standards for Mexican trucks and new rules on fishing to protect marine life.
~ So Trump creates a deal that improves Mexican workers wages, removes barriers for US dairy farmers, protects intellectual property, and protects the environment. No wonder the press hates it.
Please pass the butter
Since 1994, the U.S. and Canada have dropped tariffs and other trade restrictions on most agricultural products. But there were a few exceptions, most notably dairy.
Dairy was a particularly problematic sticking point in year-long negotiations between the three countries. The U.S. and Canada both have long histories of protectionist policies, such as subsidizing dairy farmers and setting import quotas on milk. Canadian tariffs on some products can be as high as 300%.
The new USMCA begins to change that, representing a small but important win for both countries, especially the U.S.
Under the new accord, Canada will curb some of the ways it protects its dairy industry, such as allowing more American milk, butter, cheese and other dairy products to enter Canada duty-free, with reciprocal treatment for Canadian dairy exports to the U.S.
Made in North America
The new agreement also made big changes for auto manufacturers in hopes of ensuring more vehicles and parts are made in North America.
Starting as early as 2020, to qualify for zero tariffs when crossing borders, a car or truck must have 75% of its components manufactured in Canada, the U.S. or Mexico, up from 62.5% currently.
Even more noteworthy, negotiators agreed to a new requirement that 40% to 45% of a vehicle’s components must be made by workers earning at least US$16 per hour, which is about three times more than the average wage currently earned by Mexican auto workers.
This change is huge, particularly for low-paid workers in Mexico. But it may lead to challenges over the enforcement of labor laws and increase the cost of cars made in all three countries.
~ This is what they said would occur in the first NAFTA which did not happen. Remember our leaders telling us it would improve the living conditions of Mexican border towns? All it did was reduce make our border towns look like theirs.
Keeping up with the times
Society has experienced significant technological changes since NAFTA was implemented in 1994. Back then, the internet was still in its infancy, while smartphones and self-driving cars were barely imaginable.
That’s why modernization – updating rules and standards to keep up with the times – is a critical and positive update to the trade deal tying the North American continent together.
While NAFTA was the first trade treaty to include intellectual property protections, the high pace of innovation has made modernization of its provisions imperative.
The new agreement includes stronger protections for patents and trademarks in areas such as biotech, financial services and domain names – all of which have advanced considerably over the past quarter-century. It also contains new provisions governing the expansion of digital trade and investment in innovative products and services.
Separately, negotiators agreed to update labor and environmental standards, which were not central to the 1994 accord and are now typical in modern trade agreements. Examples include enforcing a minimum wage for autoworkers, stricter environmental standards for Mexican trucks and new rules on fishing to protect marine life.
~ So Trump creates a deal that improves Mexican workers wages, removes barriers for US dairy farmers, protects intellectual property, and protects the environment. No wonder the press hates it.
