In the wake of the announcement updating the North American Free Trade Agreement, talks are expected to accelerate regarding the Trump Administration’s decision earlier this year to increase tariffs on steel and aluminum imports.
Those tariffs were set at 25 percent for steel and 10 percent for aluminum imports from both Canada and Mexico.
Although American and Mexican trade officials were able to craft a deal last month that brought new life to the 24 year-old agreement, Canadian trade officials were not able to resolve their differences with both countries until this past weekend.
The new trade document, which governs upwards of $1.2 trillion in trade between the three countries, is being called the United States-Mexico-Canada Agreement.
While the new USMCA agreement won’t officially be signed by the three countries until early December, representatives with both Mexico and Canada are hoping to reach a consensus with the U.S. on the tariff matter well before then.
Those increased tariffs have been particularly hard felt in the U.S. construction industry with the price of both steel and aluminum steadily increasing since last spring.
In a statement, Thomas Gibson, the president of the American Iron and Steel Institute, said of the USMCA: “We are pleased that the agreement is trilateral, as the relationship between our three countries has been extremely beneficial for the steel industry and resulted in robust trade and investment in the region over the past 25 years.”
Gibson added that the new agreement is “significant as it will keep our manufacturing supply chains strong throughout North America.”
Slated to take effect on the first day of 2020, the USMCA increases the share of North American auto parts used to manufacture a vehicle, and also raises the minimum wages of workers in Mexican auto plants.
According to the USMCA, some 30 percent of cars will now have to be made by workers earning at least $16 an hour.
By Garry Boulard
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