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December 10, 2019 0 Comments

Canada, Mexico and the United States agree on revised trade deal

OTTAWA—Canada, Mexico and the United States have agreed to changes demanded by American Democrats to the new North American free trade pact that now open the door to its ratification by all three nations.

Deputy Prime Minister Chrystia Freeland travelled to Mexico City Tuesday where she was scheduled to take part in a meeting and signing ceremony with United States Trade Representative Robert Lighthizer and Mexico’s Undersecretary for North America, Jesús Seade, at the Palacio Nacional.

“I’ll believe it when I see it,” said a senior Canadian official from Mexico, speaking on background. But with public statements Tuesday by U.S. President Donald Trump, House Speaker Nancy Pelosi and American union leaders supporting it, the Canadian team was cautiously optimistic.

“That’s what we’ve been waiting for and what we needed to see,” the official said. “So this is done and we should expect in a couple of hours the amended new NAFTA will be signed and we’ll move into the ratification phase.”

The prime minister, en route into a cabinet meeting Tuesday, had little to say about the agreement other than a brief comment in French: “We are working hard.”

In Canada, the House of Commons is set to rise Friday, and ratification is likely not to occur until January. Trudeau has promised a vote in parliament on the deal.

Mid-morning, Canadian officials were to brief the NAFTA advisory council members with whom Freeland consulted with throughout the negotiations.

House Speaker Nancy Pelosi confirmed Tuesday that an agreement had been reached.

“There is no question that this trade agreement is much better than NAFTA. It is infinitely better than what was initially proposed by the administration,” Pelosi said in Washington.

“It makes all the difference in the world to workers in America, to workers in Canada, to workers in Mexico,” she said.

“Globalization is a reality, it’s not going away,” she said.

Pelosi said Democrats limited their changes to better enforcement of environmental standards, workers’ rights, and changes to pharmaceutical drug protections that will mean lower drug prices for Americans.

Canadian negotiators are happy with the changes demanded by the Democrats, especially the decision not to extend patent protection to 10 years for a special class of drugs known as biologics. That protection will remain at eight years.

“Frankly, we have always been comfortable with what the Democrats were pushing because we agreed with all of it and it’s better for us,” said the official.

“The 10-year biologics rule that would have driven prescription drug prices a bit higher, it was always going to be a mild increase but it would have been an upward pressure on prescription drug prices in Canada and the U.S. — Pelosi has demanded that disappear and it’s gone.”

Trump came into office threatening to negotiate a new trade deal with Mexico and Canada or tear up the existing North American Free Trade Agreement, which he condemned as a bad deal for the United States.

The three nations hammered out details of a new deal more than a year ago after 13 months of sometimes acrimonious negotiations. But the terms of the proposed pact faced opposition among Democrats in Washington and Mexican officials, notably provisions to strengthen labour protections in that country.

Pelosi said the revised agreement has come “a long way” from the terms first agreed to by the three nations in 2018.

“Certainly we would never have agreed to what the president proposed,” Pelosi said. “That is what the Trump administration gave us. A non-starter.”

News of the deal comes the same day that Democrats introduced articles of impeachment against Trump. The U.S. president tweeted both his fury at impeachment and praise for the new NAFTA, or United States-Mexico-Canada Agreement (USMCA).

“Looking like very good Democrat support for USMCA. That would be great for our country!” Trump said on Twitter.

“America’s great USMCA trade bill is looking good. It will be the best and most important trade deal ever made by the USA. Good for everybody — farmers, manufacturers, energy, unions — tremendous support. Importantly, we will finally end our country’s worst trade deal, NAFTA!” the president wrote.

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Agreement on the revised terms will bring relief in Ottawa, where there had been fears that the new deal might have gotten lost in the political turmoil in Washington around impeachment and the election year.

News of the deal was cheered by Canada’s business community, which has been forced to deal with the uncertainty caused by the trade talks. The Canadian Chamber of Commerce called the deal a “crucial milestone.”

“Over the last three years, Canadian businesses have sought certainty on the future of the North American trade relationship against the backdrop of a protectionist U.S. administration whose NAFTA renegotiation strategy included imposing illegal steel and aluminum tariffs on Canadian exports and threats against other sectors,” the chamber said in a statement.

Bruce Campion-Smith

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