NAFTA-replacement seen as a first step that could clear the way for the elimination of tariffs that continue to hurt the North American boat industry
US President Donald Trump, Canadian Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto signed the United States Mexico Canada Agreement (USMCA) in Argentina early Friday morning, officially replacing the former North America Free Trade Agreement (NAFTA) and establishing a course for future trade between the three countries.
Although the deal is still to be ratified by all three governments, the news comes following days of speculation over whether the landmark trade agreement would be signed at all given that significant tariffs still exist between the three nations. Those tariffs, which stem from US measures against imported steel and aluminium using national security as a justification, led to Canada and Mexico retaliating with tariffs of their own against American-made goods, including boats.
All have had a negative impact on the North American recreational boating industry, where manufacturing has been widely integrated between the three nations since NAFTA was signed in 1994.
Officials from all three governments have maintained that the USMCA agreement lies outside of tariff negotiations, although at one point Mexican President Pena Nieto indicated the pact would not be signed until tariffs were eliminated. The outgoing Mexican President lauds the agreement as a victory for Mexico, saving free trade from a US president who wanted to eliminate it altogether. The document was signed on his last day in office; on Saturday, he will be replaced by incoming president Andres Manuel Lopez Obrador, who has previously questioned the value of NAFTA and international trade in general.
US President Donald Trump credits the tariffs with enabling the new trade pact to be completed. “Without tariffs, we wouldn’t be talking about a deal – just for those babies out there that talk about tariffs,” he said on Monday.
But Canadian Prime Minister Justin Trudeau said that removing American steel and aluminium tariffs remains a priority for both Canada and Mexico, and remains optimistic. “That is something the Americans have indicated they are more than willing to work on,” he said.