Trevor Dobbs, Staff Writer
After a long and grueling trade dispute between the North American economic giants and after several rounds of tariffs that have been fired back and forth between the North American trade partners, it appears that Mexico, Canada and the United States have finally come to an agreement on trade. This was long overdue, as trade markets around the world were absolutely terrified about the potential outcome of what has been several weeks of escalating trade conflicts, especially since President Trump had threatened to dismantle the North American Free Trade Agreement all together without any kind of replacement. Now that we have finally come up with this groundbreaking agreement and have successfully convinced Canada to join in, hopefully this gives investors a breather and gives the world markets more certainty in these turbulent economic times.
While the deal hasn’t been officially voted on, it could be safely assumed that it will probably be approved into law whenever it is given to congress for a vote decision.
I would like to hope that fair trade, good wages and better jobs are bipartisan issues that can bring together Americans from both parties and political camps. This has been a task that both Republican and Democratic parties have claimed they wanted to work on, and ultimately, I think this is a win for both and for the American people at large. More specifically, this is a great win for North American workers and businesses. Nonetheless, despite how good the deal may seem on the surface, we will have to wait and see; in today’s political era, nothing seems for certain.
Not all details of the deal have been released, and more than likely, there will possibly be tweaking of some of the details before the it is finalized. However, the details and general outline have been given to us, and from taking a look at it, it is a good deal. The new deal, named the United States-Mexico-Canada Agreement, outlines several different new trade rules in which the North American continent will abide by.
The following are examples of some of the primary features of the deal.The first is in order to qualify for tariff-free access to the North American markets, the deal will require that 75 percent of the parts be made in the USMCA region for automobile-manufacturers. The second provision in the deal is that 40 to 45 percent (details pending) of the car must be made by a high-income country – defined as a country that pays its workers at least $16 per hour, which is a huge win for workers. Next, the duty-free shopping threshold for online shopping will be raised to $100 for Mexico and $115 for Canada. The U.S. will also be given access to 3.6 percent of Canada’s dairy market, a historically protectionist market. The last deal allows Permanently imposed steel/aluminum tariffs for foreign steel entering U.S. markets.
All in all, this seems like a great deal and I am excited to see where it goes. This will have a tremendous positive impact on not only the entire economy of the United States, but Canada and Mexico as well.