US & Canada agree to new trade deal

The US and Canada have reached a new trade deal, replacing the North American Free Trade Agreement (Nafta).

Along with Mexico, the new deal was agreed on following six weeks of negotiations and is called the United States-Mexico-Canada Agreement (USMCA).

US Trade Representative Robert Lighthizer and Canadian Foreign Affairs Minister Chrystia Freeland said in a joint statement: “Today, Canada and the United States reached an agreement, alongside Mexico, on a new, modernized trade agreement for the 21st Century: the United States-Mexico-Canada Agreement.”

The agreement “will give our workers, farmers, ranchers and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region”.

The new deal will allow higher imports of Canadian cars and greater access to Canada’s dairy market for the US.

US farmers will have access to about 3.5 percent of Canada’s dairy market. Canada has gained protections for its automobile industry against potential US tariffs and the new US tariffs on steel and aluminium will remain for the time being.

Before the deal was agreed, it looked as though Canada risked being excluded from the deal. The US gave Sunday as a deadline for Canada to agree to the deal. 

The agreement is a step for the US, where Trump has begun several trade wars this year including placing tariffs on steel and aluminium imports from Mexico and Canada and implementing billions of dollars worth of tariffs on China.