Mexico ratifies new trade deal with US, Canada

Mexico ratified the new North American trade agreement Wednesday, making the country the first to give it final approval despite recent tension with the US. The United States-Mexico-Canada Agreement (USMCA) passed in the Mexican Senate with 114 votes in favor and just four against, sending what the government called “a clear message in favor of an open economy and deepening economic integration in the region.”

“This means foreign investment in Mexico, jobs in Mexico, access to the US market for our products,” said President Andres Manuel Lopez Obrador. There was little doubt the new deal would pass easily in Mexico: the very similar agreement it aims to replace, the North American Free Trade Agreement (NAFTA), has helped turn the country into an exporting powerhouse over the past 25 years. The next move now belongs to Canada and, especially, the US.

The three countries signed the agreement on November 30 after a year of tough negotiations triggered by US President Donald Trump’s insistence on replacing NAFTA, which he calls “the worst trade deal ever made.” Trump congratulated his Mexican counterpart on the ratification, and called on American lawmakers to do likewise. “Congratulations to President Lopez Obrador -- Mexico voted to ratify the USMCA today by a huge margin. Time for Congress to do the same here!” Trump tweeted. Canadian Prime Minister Justin Trudeau is due to visit Trump and US Congressional leaders to push for ratification of USMCA, among other issues.

The deal faces a battle in the US Congress, where opposition Democrats have criticized provisions including its worker protections and dispute resolution system. Still, US Trade Representative Robert Lighthizer said he was confident there would be progress on ratification in “the next couple of weeks.” He called Mexico’s ratification “a crucial step forward.” In Canada, ratification looks assured. The new deal largely resembles the original, but notably establishes new rules for the crucial auto sector, intended to boost US-made content in cars and increase wages for Mexican workers.

Mexico sends nearly 80 percent of its exports to the United States, and regional free trade is broadly popular here. Analysts saw Mexico’s early ratification of the trade deal as a strategic move. “Mexico wants to show good will and ratifying the USMCA quickly could help somewhat so that the debate focuses on ratification in the US,” said consulting firm Eurasia Group.