NAFTA (USMCA)
The North American Free Trade Agreement (NAFTA) is an agreement signed by Canada, Mexico, and the United States, creating a trilateral trade bloc in North America. The agreement came into force on January 1, 1994, and superseded the 1988 Canada–United States Free Trade Agreement between the United States and Canada. The NAFTA trade bloc is one of the largest trade blocs in the world by GDP. After U.S. President Donald Trump took office in January 2017, he sought to replace NAFTA with a new agreement, beginning negotiations with Canada and Mexico. In September 2018, the United States, Mexico, and Canada reached an agreement to replace NAFTA with the United States–Mexico–Canada Agreement (USMCA). NAFTA will remain in force, pending the ratification of the USMCA.

Trump’s Broken Nafta Promise

12/27/18
from The Wall Street Journal,
12/26/18:

The U.S. still hasn’t lifted metals tariffs on Canada and Mexico.

When President Trump signed his new Nafta accord last month with the leaders of Mexico and Canada, Prime Minister Justin Trudeau almost didn’t show up. The reason: Mr. Trump still hasn’t lifted the steel and aluminum tariffs as he promised he’d do if America’s two neighbors signed a revised trade deal. A month later they’re still waiting. The delay is damaging the U.S. economy and America’s credibility as a trading partner. Though Mr. Trump likes to use tariff threats as a negotiating tactic, his Administration also promised relief from the levies he imposed under Section 232 of U.S. trade law.

Last March no less than the President himself tweeted that “tariffs on Steel and Aluminum will only come off if new & fair NAFTA agreement is signed.” Yet U.S. officials now say signing new Nafta isn’t enough. They also want Canada and Mexico to agree to new quotas on their metals exports to the U.S. before the U.S. will lift the Section 232 tariffs. This is politically managed trade that responds to lobbying in Washington, not free trade that responds to market supply and demand. Canada is the largest foreign supplier of steel to the U.S., with a 20% import share, so the goal of quotas would be to limit steel supply to keep prices in the U.S. high. Canada and Mexico are understandably resisting since they thought a new Nafta would mean the end of arbitrary tariffs imposed in Washington. Meanwhile, American steel consumers continue to suffer from the tariffs. One loser is the American beer industry, which says the tariffs amount to a $347 million tax on U.S. brewers. Beer Institute President Jim McGreevy says U.S. brewers used more than 36 billion aluminum bottles and cans last year and the tariffs “could cost the beer industry more than 20,000 jobs.”

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