Source: ABC Aluminum

Recently, Mexico and the United States reached a handshake agreement on major revisions on NAFTA, that echo more of a new trade deal between US-Mexico. Likewise, the United States is currently in negotiations with Canada. These negotiations are because both Trump and his administration want to get rid of the North Atlantic Free Trade Agreement [NAFTA]. Due to the belief that NAFTA was a horrible deal for America, to begin with. 

The U.S-Mexico handshake agreement breakthrough included many mutual agreements between the two. One of these agreements was a new set limit on the content of an automobile that must be American for the automobile to be duty-free across borders. That amount is 75 percent which is approximately an increase of 12.5 percent from its original 62.5 percent amount. This agreement has been a thorny topic in the United States because United States automakers have long opposed the increase, and yet the United Autoworkers Union has long pushed for this increase. Another agreement is the increase in the number of vehicles manufactured in factories that are paying an average wage of $16 an hour.  

However, when this US-Mexico handshake happened Canada wasn’t at the negotiating table. Prior to the U.S-Mexico breakthrough announcement, Canadian Foreign Minister Chrystia Freeland and Canada itself felt encouraged by the positive negotiations that both the US and Mexico demonstrated. The reason why Canada and its foreign minister felt invigorated by this is that “Progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement” (NPR). Likewise, however, Freeland also echoed caution stating Canada would only sign a new NAFTA that was good for Canada itself. Therefore, many believe that the US-Canada negotiations could be more drawn out. Thus, it is no surprise that on August 31, 2018, the United States and Canada found themselves at the negotiating table for a fourth day to try desperately to hammer out a deal. Likewise, it has been reported by Lindsay Walters, White House Deputy Press Secretary, “The Canadian and American negotiators continue to work on reaching a win-win deal that benefits both countries” (NPR). However, currently the US and Canada are still at odds with “nettlesome issues such as opening Canada’s dairy markets to U.S. exports, patent protections for certain drugs and language on how to resolve some disputes” and thus no deal has been agreed on yet” (Politico).  

Furthermore, under United States law a three month wait period is placed on a new North Atlantic free trade agreement after it has been completed prior to its ratification by Congress. This has caused some concern as Mexico swears in its new President Andrés Manuel López Obrador, on Dec. 1. Likewise, November is the United States Midterm election, and Congress needs 90 days to review the agreement prior to ratification. Therefore, President Trump is somewhat under pressure to get Canada on board, but many believe that Canada knows the clock is ticking and thus is using the clock as its bargaining chip against the US. Consequently, only time will tell if a deal will be made or if NAFTA renegotiations will be hindered till a later date.  

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