North American free trade accord reborn

• The US, Canada and Mexico trade agreement finalized Tuesday.
• The North American Free Trade Agreement (NAFTA) between the three countries came into force on January 1, 1994.
• Trump came to office in 2017 demanding an overhaul of the "terrible" NAFTA deal.

WASHINGTON: The US, Canada and Mexico trade agreement finalized Tuesday is the result of more than two years of talks and replaces a 1994 deal rejected by President Donald Trump.

Here is some background.

 1994: NAFTA is born 

The North American Free Trade Agreement (NAFTA) between the three countries came into force on January 1, 1994, as one of the most important trade pacts in the world.

It removed most tariffs on goods traded between them, liberalized investment rules and allowed greater movement of workers between the countries.

Some goods were exempted from the accord, such as softwood lumber which Canada and the United States have repeatedly fought over.

 Trump forces negotiation 

Trump came to office in 2017 demanding an overhaul of the "terrible" NAFTA deal, which he blamed for an exodus of manufacturing jobs to Mexico.

Complicated talks were launched in August 2017.

 Trade war

In May 2018, amid a delay in NAFTA negotiations, Washington extended punitive tariffs on steel and aluminum to Canada and Mexico.

They complained to the World Trade Organization (WTO).

On June 5 Mexico published a list of American products on which it would impose retaliatory tariffs, including pork, whiskey, cheese, apples and grapes.

Canada on June 29 also announced taxes on US steel and aluminum, whiskey, ketchup, orange juice, sailing ships, and lawnmowers.

Washington protested the retaliatory measures at the WTO.

First deal signed 

On August 27 Trump announced a draft new trade accord with Mexico, which still did not cover Canada.

Negotiations with Canada were finalized on October 1.

On November 30 the three signed the United States-Mexico-Canada Agreement (USMCA) treaty.

The text remained to be ratified by the three national parliaments.

 US union opposition 

On April 23, 2019 the umbrella American union, the AFL-CIO, came out in opposition to ratification of the agreement, doubting Mexico would honor commitments to reforming employment legislation which gave its factories an advantage over US ones.

Amendments demanded 

On May 17 Trump ended the tariffs on Canadian and Mexican steel and aluminum, lifting an important obstacle to ratification.

Later that month, Canadian Prime Minister Justin Trudeau and Mexican President Andres Manuel Lopez Obrador presented the draft treaty to their respective parliaments for ratification.

The American administration also launched the process of ratification but the Democrats, in a majority in the House of Representatives, demanded amendments.

Trump rankled his partners when he imposed from June 10 tariffs on Mexican goods in a bid to force the country to stem the influx of illegal migrants and drugs.

He lifted the measure after the announcement on June 7 of an accord on immigration.

- Second version backed -

On June 19 Mexico's parliament ratified the deal. Canada said it was ready to do so but only after the United States.

Negotiations were launched on amendments, including on Democratic demands for tougher enforcement of labor standards in Mexico.

On December 9 reports emerged that US and Mexican negotiators had reached a deal making changes to labor enforcement under the accord.

The following day the AFL-CIO endorsed the changes and US House Speaker Nancy Pelosi said Tuesday the new deal was much improved.

The final deal now has to be ratified by all three countries' legislatures.