BREAKING NEWS OHA reports 342 new cases, 5 new deaths Full Story

US and Mexico reach a preliminary trade deal that could replace NAFTA

The United States and Mexico have reached an agreement to change parts of NAFTA, the trade deal that Preside...

Posted: Aug 28, 2018 5:56 PM
Updated: Aug 28, 2018 5:56 PM

The United States and Mexico have reached an agreement to change parts of NAFTA, the trade deal that President Donald Trump has derided for years as unfair.

Trump announced the agreement from the Oval Office Monday, with Mexican President Enrique Peña Nieto dialed in on a conference call.

Business, economy and trade

Continents and regions

Latin America

Mexico

North America

The Americas

Trade and development

United States

International trade

Donald Trump

Political Figures - US

Canada

Economic policy

Economy and economic indicators

International trade law

Tariffs and customs

Trade regulation and policy

Government and public administration

Government bodies and offices

US federal government

White House

Free trade treaties and agreements

International relations

International relations and national security

Trade treaties and agreements

Treaties and agreements

But the deal left open the question of whether Canada, the third country in NAFTA, would agree to the changes -- and Trump himself said he wanted to throw out the name NAFTA altogether.

"They used to call it NAFTA," Trump said. "We're going to call it the United States-Mexico trade agreement. We're going to get rid of NAFTA because it has a bad connotation."

US Trade Representative Robert Lighthizer said the agreement was "absolutely terrific" and would modernize a trade deal that had "gotten seriously out of whack." He said he hoped Congress would approve it with broad bipartisan support.

On a separate call with reporters, Lighthizer highlighted some big changes that negotiators from both countries agreed to.

  • Auto manufacturing: The new deal would require that 75% of the parts in any car sold in North America be produced in the United States or Mexico. Currently, about 62% of parts are required to be produced in the United States, Mexico or Canada.
  • Higher labor standards: The new deal would require that 40% to 45% of auto parts in cars sold be made by workers earning at least $16 USD per hour.
  • Sunset clause: The agreement will last for 16 years, and will be reviewed every six years.

Much of the business world has been worried about Trump's trade policies, and the stock market reacted positively to the news of a deal. The Dow closed nearly 260 points higher on Monday.

The agreement between the two countries could restart negotiations on NAFTA with all three parties -- the United States, Mexico and Canada.

Despite Trump's signal that the deal could lead to a bilateral trade agreement between the United States and Mexico, Peña Nieto, through a translator, expressed his "desire that now Canada will also be able to be incorporated in this."

Mexico and Canada have stood firm on the importance of maintaining the trilateral format of the NAFTA free trade deal, even as Trump has signaled a desire for individual deals with each country.

"Canada is encouraged by the continued optimism shown by our negotiating partners," said a spokesperson for Canadian Minister of Foreign Affairs Chrystia Freeland.

"Progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement," he said.

Freeland will travel to Washington on Tuesday to continue negotiations.

Negotiations on rewriting the three-country NAFTA agreement began about a year ago.

The 24-year-old trade agreement generally prevents the three parties from imposing tariffs on imports from one another. But Trump has called the agreement "the worst deal maybe ever signed" and moved ahead with tariffs earlier this year.

In May, the United States imposed steep tariffs on steel and aluminum from much of the world, including Mexico. In response, Mexico slapped tariffs on $3 billion of US goods, including steel, pork, apples, potatoes, bourbon and different types of cheese. Canada imposed tariffs on $12.5 billion of US goods, including steel, toffee, maple syrup, coffee beans and strawberry jam.

Oregon Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 19366

Reported Deaths: 328
CountyConfirmedDeaths
Multnomah449793
Washington284923
Marion269268
Umatilla206024
Clackamas142136
Malheur67610
Deschutes5408
Lane5233
Lincoln3959
Jackson3941
Union3882
Yamhill38611
Jefferson3113
Morrow3051
Polk29612
Linn25410
Klamath1961
Wasco1703
Hood River1690
Benton1576
Douglas1341
Josephine1071
Coos850
Clatsop820
Columbia790
Crook431
Baker330
Lake320
Tillamook300
Wallowa191
Sherman150
Curry140
Harney80
Gilliam40
Grant20
Unassigned00
Wheeler00
Eugene
Few Clouds
88° wxIcon
Hi: 88° Lo: 57°
Feels Like: 88°
Corvallis
Clear
87° wxIcon
Hi: 88° Lo: 56°
Feels Like: 87°
Roseburg
Clear
84° wxIcon
Hi: 88° Lo: 60°
Feels Like: 84°
North Bend
Broken Clouds
64° wxIcon
Hi: 66° Lo: 56°
Feels Like: 64°
KEZI Radar
KEZI Temperatures
KEZI Planner

LATEST FORECAST

Community Events