The new agreement between Mexico and Canada, also known as the United States-Mexico-Canada Agreement (USMCA), is a recently updated and modernized version of the North American Free Trade Agreement (NAFTA) that was first created in 1994.
The USMCA was signed by all three countries on November 30, 2018, and replaced NAFTA on July 1, 2020. The goal of this new agreement is to promote fair trade between the three countries by removing barriers to trade and increasing market access.
Some of the key changes made to the USMCA include stronger labor and environmental protections, better access to the Canadian dairy market for American farmers, and updated rules for digital trade.
One of the most significant changes in the USMCA is the new labor provisions. The agreement requires Mexico to change its labor laws to ensure that workers have the right to unionize and receive fair wages. This provision is aimed at addressing concerns that Mexico`s lower wages and weaker labor laws incentivize companies to move jobs from the United States and Canada to Mexico.
The USMCA also includes new environmental provisions that aim to reduce plastic pollution and promote sustainable forestry practices.
Another significant change made in the USMCA is the updated rules for digital trade. The agreement includes new provisions that protect online data privacy and prevent the imposition of unnecessary barriers to cross-border data flows.
Overall, the USMCA is designed to promote free and fair trade between the three countries and create a more level playing field for businesses to compete. By modernizing the NAFTA agreement, the USMCA ensures that North American trade remains strong and prosperous for years to come.