Senate approves new USMCA trade agreement with Canada and Mexico

Speaking in the Senate room on Wednesday, majority leader Mitch McConnell (R-Ky.) Called the agreement’s approval “A great victory for Kentucky and the 50 states.” A great victory for our country. A great victory for the Trump administration. “

In fact, the approval of the Agreement between the United States, Mexico and Canada gives Trump a key victory at a time of political danger, with the Senate ready to begin his trial trial after the House handed over his articles of political trial. Wednesday night. Trump made his opposition to the 25-year North American Free Trade Agreement a centerpiece of his campaign for president in 2016. He can now boast of delivering a new trade agreement that includes important new protections for American workers, despite that many of them were negotiated by House Democrats over the objection of Senate Republicans.

Trump must still sign the revised North American Free Trade Agreement, something he suggested he would probably do next week.

Senate Republicans had little influence on the process because President Nancy Pelosi (a Democrat for California) played a decisive role in the decision to take the agreement to the floor of the House, which by law had to act first in the agreement. The huge role played by House Democrats and their allies at work angered some Republicans, including Senator Pat Toomey (Republican), the most frank opponent of the agreement, who complained that the Senate was “displaced” in the process.

But supporters, including Finance President Charles E. Grassley (R-Iowa), said they had no choice but to support the agreement they had before them. They called it good news for the US economy and workers. UU., Noting the initial projections of the International Trade Commission that it will add 176,000 jobs in the US. UU., Although that represents an increase of only 0.12, a modest impact on the US economy of almost $ 21 billion.

One provision, which allowed Mexican workers to file complaints about working conditions that could lead to punitive actions by the United States, was included at the insistence of Senator Sherrod Brown (D-Ohio), a leading trade protectionist who announced its support for USMCA after opposing all previous free trade agreements.

The agreement created divisions in the Democratic presidential primary camp. In a debate Tuesday night, Senator Bernie Sanders (I-Vt.) Predicted that the agreement would lead to continued outsourcing of jobs in the United States and said: “We could do much better than a Trump-led trade agreement.” The candidates, including former Vice President Joe Biden and Senator Elizabeth Warren (D-Mass.), Support the agreement. Warren called it a “modest improvement” that will provide the necessary relief to farmers and workers affected by Trump’s trade policies.

Senate Majority Leader Charles E. Schumer (DN.Y.) voted against USMCA, saying that while the agreement includes labor provisions, “it does not address climate change, the biggest threat facing the planet.” In a statement, Schumer said the Trump administration is giving incentives for manufacturers to move business and jobs from the US. UU. to Mexico, which has weaker regulations for clean air and water.

“The Trump administration also included brochures for the oil and gas industry, such as raising tariffs on oil sands, and refused to include any mention of the climate crisis in the agreement,” Schumer said.

Thursday’s vote came one day after Trump signed a partial economic agreement with China, almost two years after a prolonged trade war with Beijing. As part of the agreement, China promised to buy an additional $ 200 billion in US exports above previous levels. With the USMCA vote, Trump has consecutive victories in trade that can calm the waters after the president has caused trade wars around the world and leveled tariffs on friends and enemies.

The USMCA was signed more than a year ago by Trump and the leaders of Mexico and Canada, but it still had to be approved by the legislatures of the three nations. Mexico has already acted, and Canada’s parliament is expected to follow the United States and approve the agreement in the coming months. After some additional procedural steps, the agreement is expected to come into force later this year.

The House Democrats called for substantial changes to the initial USMCA draft, and worked directly with the U.S. Trade Representative. UU. Robert E. Lighthizer in months of secret conversations that were largely maintained even when the House advanced to accuse the president.

The House of Representatives Democrats noted the victories in stricter environmental and compliance language, protections for workers in Mexico and eliminated a provision sought by pharmaceutical companies that would have guaranteed 10 years of market exclusivity for an expensive class of medicines called biological products. Many unions were also encouraged by the agreement, which could help prevent US and Canadian jobs from going to markets with lower wages in Mexico or Asia. Under the agreement, at least 30 percent of cars (and 40 percent by 2023) must be manufactured by workers who earn $ 16 per hour, which is approximately three times the manufacturing salary in Mexico today.

USMCA also gives US dairy producers more access to the Canadian market, especially for “Class 7” dairy products such as milk powder and milk proteins. The agreement imposes some restrictions on the amount of dairy products that Canada can export, which could help US dairy producers enter foreign markets.

USMCA also includes new rules for digital commerce, something that barely existed when the original NAFTA was written. Among these, however, there is a provision that provides protection to large technology companies by granting legal immunity to Internet platforms over the content published by users. Pelosi opposed the provision, but failed to keep it out of agreement in the final agony of the talks last month. She cited it as her only disappointment in how the agreement turned out.

Economists also fear that USMCA will stimulate an increase in car prices, especially in smaller cars that were produced in Mexico but may be subject to border tariffs. U.S. tariffs on Canadian steel also remain in effect.

And while the tensions have cooled between Washington and Beijing after almost two years of trade escalation, there are few details about how phase II of a trade agreement will be, even if many US sectors and companies say they are still subject to tariffs that Stay in place.

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