BUENOS AIRES: The United States, Canada and Mexico signed a North American trade pact on Friday, and President Donald Trump predicted an easy passage through U.S. Congress to approve the deal, despite opposition from some lawmakers.

The three leaders agreed on a deal in principle to govern the more than trillion dollars of mutual trade after a year and a half of acrimonious negotiations concluded with a late-night bargain just an hour before a deadline on Sept. 30.

Since then, the three sides have bickered over the wording and the finer points of the deal and still had not agreed just hours before officials were due to sit down and sign it as the G20 summit kicks off in Buenos Aires.

"It’s been long and hard. We’ve taken a lot of barbs and a little abuse and we got there," Trump said.

Legislators from the three countries still have to approve the pact, officially known as the United States-Mexico-Canada Agreement (USMCA), before it goes into effect and replaces the North American Free Trade Agreement (NAFTA).

But the U.S. trade landscape will shift significantly in January when Democrats take control of the U.S. House of Representatives after winning midterm elections in November. House Democratic Speaker Nancy Pelosi, has pledged to "closely scrutinize" the new pact.

However, Trump and U.S. Trade Representative Lightizer said they were confident the agreement would pass Congress.

"This was negotiated from the beginning to be a bipartisan agreement.... I think we’ll get the support of a lot of Democrats," he told reporters.

Canadian Prime Minister Justin Trudeau's spokesman only confirmed his attendance late on Thursday. Before signing the deal he continued to refer to as the new NAFTA, Trudeau told Trump the two should continue to work together to eliminate steel and aluminum tariffs.

Mexico's President Enrique Pena Nieto joined the ceremony on his last day in office.

Trump had vowed to revamp NAFTA during his 2016 presidential election campaign. He threatened to tear it up and withdraw the U.S. completely at times during the negotiation, which would have left trade between the three neighbors in disarray.

Trump forced Canada and Mexico to renegotiate the 24-year-old agreement because he said the existing pact encouraged U.S. companies to move jobs to low-wage Mexico.

U.S. objections to Canada's protected internal market for dairy products was a major challenge facing negotiators during the talks, and Trump repeatedly demanded concessions and accused Canada of hurting U.S. farmers.

BDI, Germany's main industry association, said in a statement the agreement's rules on preferential origin for the automotive sector would be stricter and more complex, calling it "a retrograde step compared with NAFTA." </s> USMCA: Trump Signs New Trade Agreement With Mexico And Canada To Replace NAFTA

Enlarge this image toggle caption Kevin Lamarque/Reuters Kevin Lamarque/Reuters

Updated at 8:25 a.m. ET

President Trump, Canadian Prime Minister Justin Trudeau and Mexican President Enrique Peña Nieto signed the new U.S. Mexico Canada Agreement — or USMCA — in Buenos Aires Friday, using the backdrop of the G-20 Summit to resolve a trade dispute between America and its closest neighbors.

"Let's go," all three leaders said as they sat alongside each other to sign multiple copies of the deal.

They then shuffled binders around in front of them, to finalize the deal that remakes one of the world's largest free trade zones. When the signing was over, they paused for a photo-op. "Might as well hold that up," Trump said, displaying the fresh signatures as the three leaders sat together.

Despite that and other prodding, Trudeau opted not to follow his peers in holding up his binder to celebrate — a sign, perhaps, of the lingering effects of the contentious process that was triggered when Trump imposed tariffs on Mexico and Canada earlier this year, which remain in place.

The signing event and the leaders' remarks were livestreamed. You can watch the event here.

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In the lead-up to the signing, Canadian officials had "made it clear they didn't want to celebrate the end of a year of U.S. attempts to twist Canada's arm with the tariffs still in place," the CBC reports. But that wish ran counter to the desires of Trump and Peña Nieto, both of whom have preferred to portray the deal as a victory that helps to cement their legacies.

"This has been a battle, and battles sometimes make great friendships," Trump said at the start of the signing ceremony.

Saying all three countries will benefit from the deal, Trump said of the USMCA, "It is probably the largest trade deal ever made."

The USMCA (read the whole text here) replaces the North American Free Trade Agreement, which had created a free trade zone between the three countries back in 1994. The deal will require ratification by all three countries' legislatures before taking effect.

"The biggest change this deal makes, really, is to the automotive sector," NPR's Scott Horsley reports, "where it does put higher requirements on North American content, and in particular high-wage content, for vehicles to trade duty-free."

The USMCA deal emerged in early October, months after President Trump hit Mexico and Canada with tariffs on their steel and aluminum products. That move set off retaliatory tariffs and intense negotiations to create a new trade pact.

Calling the deal "the new North American Free Trade Agreement, Trudeau said it "lifts the risk of serious economic uncertainty that lingers throughout a trade renegotiation process — uncertainty that would have only gotten worse and more damaging if we had not reached a new NAFTA."

There is more work to be done, Trudeau said, calling the recent announcement that General Motors will close plants in Canada and the U.S. "a heavy blow."

Turning to address Trump, said "And Donald, it's all the more reason why we need to keep working to remove the tariffs on steel and aluminum between our countries."

"General Motors has said that those steel and aluminum tariffs robbed it of a billion dollars in profits in the last year," Scott Horsley reports. In June, GM also warned the Trump administration that new tariffs could result in "a smaller GM."

When it was his turn to speak, Peña Nieto said the trade agreement includes provisions for e-commerce and informational technology — subjects that he said made it necessary to update NAFTA.

"In fact, one-third of the agreement includes topics that were not included in the first agreement," he said.

Peña Nieto also said the USMCA "is the first trade agreement that incorporates elements that address the social impact of international trade; it enables the participation of more sectors in the economy."

Among those provisions, he said, are protections for workers' rights and the environment, and elements that seek to extend the benefits of free trade more broadly.

The signing took place on Peña Nieto's final day in office; Mexico's newly elected president, Andrés Manuel López Obrador, will be sworn in on Saturday.

Shortly before the signing ceremony, Peña Nieto awarded presidential senior adviser and Trump son-in-law Jared Kushner with the Order of the Aztec Eagle, the highest honor Mexico gives to foreigners.

The move "shocked many in Mexico," as NPR's Carrie Kahn reported earlier this week, referring to the outrage and anger that has poured out online.

Later in the G-20 meetings, Trump will turn to another high-profile trade crisis, when he has dinner on Saturday with Chinese President Xi Jinping. </s> The new trade deal between the United States and Mexico replaces the North American Free Trade Agreement.

But so far, Canada has not agreed to enter the deal.

The US, Mexico and Canada are all facing internal political pressure over the agreement. </s> BUENOS AIRES (Reuters) - The United States, Canada and Mexico signed a North American trade pact on Friday, and President Donald Trump brushed aside difficulties he may have in getting the deal through U.S. Congress, where the opposition Democrats will control one of its two chambers from January.

The leaders of the three countries agreed on a deal in principle to govern more than a trillion dollars of mutual trade after a year and a half of acrimonious negotiations concluded with a late-night bargain just an hour before a deadline on Sept. 30.

Friday’s signing potentially ends a big source of irritation for the U.S. administration as it pivots to a much bigger trade fight with China that threatens the global economy. All eyes are on a meeting between Trump and Chinese President Xi Jinping on Saturday after a G20 summit in Buenos Aires.

Canada and Mexico bickered with the United States over the wording and the finer points of the trilateral deal and still had not agreed just hours before officials were due to sit down and sign it as the G20 summit kicks off in Buenos Aires.

“It’s been long and hard. We’ve taken a lot of barbs and a little abuse and we got there,” Trump said after the signing. “It’s been a battle and battles sometimes make great friendships.”

Canadian Prime Minister Justin Trudeau still had a few barbs of his own on Friday. He called the deal by its old name NAFTA, prodded Trump over U.S. steel and aluminum tariffs and said General Motors Co’s (GM.N) decision to cut production and its North American workforce, including in Canada, was a “heavy blow.”

“Donald, it’s all the more reason why we need to keep working to remove the tariffs on steel and aluminum between our two countries,” Trudeau said.

Mexico’s President Enrique Pena Nieto, who awarded Jared Kushner, Trump’s son-in-law and adviser, with Mexico’s highest order for foreigners, was warmer. On his last day in office, he said the new deal was forged with the “firm belief that we are stronger and more competitive.”

Legislators from the three countries still have to approve the pact, officially known as the United States-Mexico-Canada Agreement (USMCA), before it goes into effect and replaces the North American Free Trade Agreement (NAFTA).

But the U.S. trade landscape will shift significantly in January when Democrats take control of the U.S. House of Representatives in January after winning midterm elections in November. House Democratic Speaker Nancy Pelosi has pledged to “closely scrutinize” the new pact.

However, Trump and U.S. Trade Representative Robert Lighthizer said on Friday they were confident the agreement would pass Congress.

“It’s been so well reviewed I don’t expect to have very much of a problem,” Trump said.

Trump had vowed to revamp NAFTA during his 2016 presidential election campaign. He threatened to tear it up and withdraw the U.S. completely at times during the negotiation, which would have left trade between the three neighbors in disarray.

Trump forced Canada and Mexico to renegotiate the 24-year-old agreement because he said the existing pact encouraged U.S. companies to move jobs to low-wage Mexico.

U.S. objections to Canada’s protected internal market for dairy products was a major challenge facing negotiators during the talks, and Trump repeatedly demanded concessions and accused Canada of hurting U.S. farmers.

BDI, Germany’s main industry association, said in a statement the agreement’s rules on preferential origin for the automotive sector would be stricter and more complex, calling it “a retrograde step compared with NAFTA.” </s> BUENOS AIRES, Argentina — President Donald Trump joined the leaders of Canada and Mexico at a global meeting in Argentina on Friday (Nov. 30) to sign a revised North American trade pact, fulfilling a longstanding political promise with a deal he celebrated as a “groundbreaking achievement.”

The U.S.-Mexico-Canada Agreement is meant to replace the 24-year-old North American Free Trade Agreement, which Trump has long denigrated as a "disaster." However, ongoing differences over steel and aluminum tariffs the U.S. has imposed on its northern and southern neighbors encroached on the celebratory moment.

Trump appeared with Canadian Prime Minister Justin Trudeau and outgoing Mexican President Enrique Pena Nieto at the Group of 20 nations summit in Buenos Aires for the formal signing ceremony. Each country's legislature must also approve the agreement.

"It's been long and hard. We've taken a lot of barbs and a little abuse and we got there," Trump said of the pact. "It's great for all our countries."

Legislative approval is the next step in the process, but could prove to be a difficult task in the United States, especially now that Democrats — instead of Trump's Republicans — will control the House of Representatives come January. Democrats and their allies in the labor movement are already demanding changes to the agreement.

Within hours of the signing, Senate Democratic Leader Chuck Schumer said that for the deal to get majority support in Congress, it must have stronger labor and environmental protections and "must prove to be a net benefit to middle-class families and working people."

While Trump hailed the revised trade pact, Trudeau was more measured and used the event to call on Trump to remove the steel and aluminum tariffs the U.S. slapped on Canada and Mexico. Trudeau also referenced recent downsizing by General Motors in North America as a "heavy blow." Trump did not mention the job losses.

"With hard work, good will and determination I'm confident that we will get there," Trudeau said.

Pena Nieto, who will handoff to his successor Saturday, said he was honored to be at the signing on the last day of his administration, saying it is the culmination of a long process "that allow us to overcome differences and to conciliate our visions."

The signing came at the front end of two days of tough diplomacy for Trump. On the top of his agenda is a Saturday dinner meeting with Chinese President Xi Jingping. which will determine if the two can ease escalating trade tensions. Before Trump arrived in Argentina he injected additional drama into the proceedings by canceling another high-stakes meeting, with Russian President Vladimir Putin.

On Friday, Trump opened the day with a cordial meeting at the Casa Rosada with Argentine President Mauricio Macri, a longtime business acquaintance. Posing for photos in the gilded Salón Blanco, Trump spoke about their longtime personal relationship and said they would discuss trade, military purchases and other issues.

"We've known each other a long while," Trump said, noting he worked with Macri's father on real estate developments. The businessman-turned-politician joked that when he and Macri first met they'd never have imagined their future roles on the world stage.

Macri is hosting the summit as he struggles with problems at home. He is trying to halt economic turmoil that has caused the steep depreciation of the Argentine peso.

Trump, who arrived in Buenos Aires late Thursday, barreled into the two-day meeting by announcing via Twitter that he was canceling a planned meeting with Russian President Vladimir Putin over Russia's seizure of Ukrainian vessels. His agenda for the weekend includes meetings with world leaders, as well as a number of heavily choreographed group activities for the gathering of leaders of rich and developing nations.

Trump faces a series of diplomatic challenges over the weekend, most notably whether he can strike an agreement with Xi.

The president canceled on Putin not long after his former lawyer, Michael Cohen, revealed he had lied to Congress to cover up that he was negotiating a real estate deal in Moscow on Trump's behalf during the Republican presidential primary in 2016. The news ensured any meeting with Putin would have put a spotlight on the special counsel's investigation into whether the Trump campaign colluded with Moscow during the campaign. Trump has denied any wrongdoing.

Trump showed that the Russia investigation was testing his ability to stay focused on summit business after he blasted the investigation in a fresh tweet on Friday, again calling it a "Witch Hunt!"

One looming question is whether Trump will have a run-in with Saudi Arabian Crown Prince Mohammed bin Salman amid global dismay over the murder of Saudi journalist Jamal Khashoggi. U.S. intelligence officials have concluded that the Saudi crown prince must have at least known of the plot to kill Khashoggi, who was critical of the Saudi royal family. Lawmakers in both parties have called on Trump to at least avoid the young heir apparent as punishment.

But Trump publicly announced his decision to effectively give the prince a pass in the name of "America First," making vastly exaggerated claims of Saudi military contracts and investments in the United States. The president also views Saudi Arabia as a vital counterbalance to Iranian influence in the Middle East.

Asked Thursday why the two had no meeting scheduled, Trump said: “I would have met with him but we didn’t set that one up.” </s> The leaders of Mexico, Canada and the United States signed a North American trade pact on Friday after brinkmanship over the final details of the deal continued through the eve of the signing.

They agreed on a deal in principle to govern the more than trillion dollars of mutual trade after a year and a half of acrimonious negotiations concluded with a late-night bargain just an hour before a deadline on Sept. 30.

Since then, the three sides have bickered over the wording and the finer points of the deal and still had not agreed just hours before officials were due to sit down and sign it as the G20 summit kicks off in Buenos Aires.

Legislators from the three countries still have to approve the pact, officially known as the United States-Mexico-Canada Agreement (USMCA), before it goes into effect and replaces the North American Free Trade Agreement (NAFTA).

Canadian Prime Minister Justin Trudeau's spokesman only confirmed his attendance late on Thursday. Before signing the deal he continued to refer to as "the New NAFTA," Trudeau told Trump the two should continue to work together to eliminate steel and aluminum tariffs.

Mexico's President Enrique Pena Nieto joined the ceremony on his last day in office.

Trump had vowed to revamp NAFTA during his 2016 presidential election campaign. He threatened to tear it up and withdraw the U.S. completely at times during the negotiation, which would have left trade between the three neighbors in disarray.

Trump forced Canada and Mexico to renegotiate the 24-year-old agreement because he said the existing pact encouraged U.S. companies to move jobs to low-wage Mexico. U.S. objections to Canada's protected internal market for dairy products was a major challenge facing negotiators during the talks, and Trump repeatedly demanded concessions and accused Canada of hurting U.S. farmers.

A side letter to the September agreement showed that Trump preserved the ability to impose threatened 25 percent global tariffs on autos while largely exempting passenger vehicles, pickup trucks and auto parts from Canada and Mexico.

"It's been long and hard. We've taken a lot of barbs and a little abuse, but we got there," Trump said of the pact.

Legislative approval is the next step in the process, but could prove to be a difficult task in the United States, especially now that Democrats – instead of Trump's Republicans – will control the House of Representatives come January. Already Democrats and their allies in the labor movement are demanding changes to the agreement.

While Trump hailed the revised trade pact, Trudeau was more measured, saying there was still work to be done and calling on Trump – using his first name – to remove steel and aluminum tariffs the U.S. imposed on Canada and Mexico. Trudeau also referenced recent downsizing by General Motors in North America as a "heavy blow." Trump did not mention the job losses.

The signing came at the front end of two days of tough diplomacy for Trump. On the top of his agenda is a Saturday dinner meeting with Chinese President Xi Jingping. which will determine if the two can ease escalating trade tensions.

Overhanging the summit in Buenos Aires, the Argentine capital, is a trade dispute between the United States and China, the world's two largest economies, which have imposed tariffs on hundreds of billions of dollars of each other's imports. All eyes will be on a planned dinner between Trump and Chinese President Xi Jinping on Saturday to see whether they can make progress toward resolving differences threatening the global economy.

Beijing hopes to persuade Trump to abandon plans to hike tariffs on $200 billion of Chinese goods to 25 percent in January, from 10 percent at present.

"We hope the U.S. can show sincerity and meet China half way, to promote a proposal that both countries can accept," Foreign Ministry spokesman Geng Shuang told a briefing in Beijing.

Trump faces a series of diplomatic challenges over the weekend, most notably whether he can strike an agreement with Xi.

Before departing Washington on Thursday, Trump said he was "very close" to reaching a deal with China but added "I don't know that I want to do it because what we have right now is billions and billions of dollars coming into the United States in the form of tariffs or taxes."

The U.S. began hiking tariffs on Chinese goods earlier this year and Beijing has responded in a tit-for-tat fashion, sparking tensions that a full trade war could erupt.

Trump increased additional duties imposed on Chinese goods this year from 10 percent to 25 percent next January. The U.S. president also said he is considering levying extra tariffs on another $267 billion worth of Chinese imports should Beijing retaliate.

With his "America First" approach, general distaste for multinational deals and habit of insulting allies, Trump typically gets a mixed reception at global gatherings.

Trump has slapped tariffs on the European Union, pulled the U.S. out of the landmark Paris Climate Accord and the Iran nuclear deal and suggested he might be willing to pull the U.S. out of NATO if member countries don't significantly boost their defense spending.

Ending the NAFTA would have meant tearing up the continent's closely integrated auto supply chain. But Ottawa, Mexico City and Washington have now agreed to sweeping changes to manufacturing and labor requirements that U.S. officials say should boost wages and discourage moving production offshore.

The deal will require that 75 percent of auto content be made in the region, increased from 62.5 percent, and that 40-45 percent be made by workers earning at least $16 an hour.

Mexico also agreed to continue to recognize U.S. auto safety standards, unless Mexican regulators conclude they are inferior to their own standards.

Trump has threatened to use a national security justification to impose steep tariffs on the hundreds of billions of dollars in autos the U.S. imports annually. But the USMCA includes side letters that agree to exempt Mexico and Canada up to a threshold of 2.6 million vehicles a year, as well as an unspecified amount of light trucks, and tens of billions of dollars in auto parts.

However, the new deal does not resolve the punishing steel and aluminum tariffs imposed worldwide earlier this year, and on Mexico and Canada since May.

Canada, which guarantees prices for its dairy producers through its managed supply system, agreed to open its borders a little wider to American milk, cheese, cream, butter and other goods.

The concession from Ottawa removed a major sticking point that Trump said was a deal breaker. Canada will also eliminate categories of low-cost dairy goods and will allow greater imports of U.S. chicken, eggs and turkey.

The U.S. agreed to Canada's insistence that the dispute settlement system – formerly known as Chapter 19 – remain in the deal. Canadian officials resolutely rejected Trump's demand to scrap provisions to resolve disagreements through international arbitration, something Ottawa has successfully used to challenge U.S. tariffs.

However, the agreement does make some changes to the more controversial "Investor-State Dispute Settlement" powers, which critics said had allowed powerful companies and wealthy investors to invalidate local laws and court decisions through unaccountable arbitration.

The new agreement requires that signatories allow equal copyright treatment for writers, composers and others from member countries, requiring a minimum term of the author's life plus 70 years for copyrighted works.

When NAFTA took effect in 1994, e-commerce hardly existed in its current form and modernizing its provisions was a key premise of the talks. The new agreement prohibits customs duties for digitally distributed goods like software and games, e-books, music and movies.

It would also limit local governments' powers to force companies to disclose propriety source code or place restrictions on where data may be stored.

Tucked in the agreement is a provision that appears designed to stop either Canada or Mexico from seeking a better deal with Beijing. If any signatory seeks to enter into a free-trade agreement with a "non-market-economy" – read China – the other parties will then be allowed to cancel the three-country deal and replace it with a bilateral agreement. </s> Mexico's Economy Minister Ildefonso Guajardo gestures during the presentation of Mexico's negotiating team for the renewal of the North American Free Trade Agreement (NAFTA) in Mexico City, Mexico, August 2, 2017.

MEXICO CITY (Reuters) - Mexico will host the second round of talks to renegotiate the North American Free Trade Agreement (NAFTA) around Sept. 10, Mexican Economy Minister Ildefonso Guajardo told reporters on Wednesday.

The talks between Canada, Mexico and the United States are due to start in Washington on Aug. 16. </s> The U.S. and Mexico reached an agreement on Monday to enter a new trade deal, ending months of talks on a replacement for NAFTA, an abbreviation for North American Free Trade Agreement.

The new trade pact will be called “The United States Mexico Trade Agreement,” Trump said when announcing the deal from the Oval Office, adding that the previous name would be scrapped.

“It’s a big day for trade, it’s a bid day for our country,” Trump said. “A lot of people thought we’d never get here because we all negotiate tough – we do, so does Mexico.”

Trump said the U.S. has yet to begin negotiations with Canada.

NAFTA has come under fierce scrutiny by President Trump, who called the agreement the “worst trade deal ever made.” Attempts to form a new pact faltered numerous times between the three countries, and talks with Mexico have been focused on creating new rules for the auto industry. Trump has argued that lower wages for employees in Mexico have cost jobs at General Motors, Ford and Fiat Chrysler – “The Big Three” – all of which have production sites in Mexico. The president said in June that a refurbished NAFTA deal could remain trilateral or could be renegotiated into two separate arrangements.

Canada said on Monday it would only sign a new NAFTA if it benefited the country and its middle class, despite showing optimism for progress the U.S. and Mexico made on a bilateral agreement of their own.

“Progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement,” a spokesperson for Canada’s Foreign Minister Chrystia Freeland told FOX Business in a statement. “We are in regular contact with our negotiating partners, and we will continue to work toward a modernized NAFTA. We will only sign a new NAFTA that is good for Canada and good for the middle class. Canada’s signature is required.” </s> WASHINGTON (Reuters) - The United States and Mexico agreed on Monday to overhaul the North American Free Trade Agreement (NAFTA), putting pressure on Canada to agree to new terms on auto trade and dispute settlement rules to remain part of the three-nation pact.

Auto stocks soared and the S&P; 500 and the Nasdaq rallied to record highs on the expectation that Canada would sign onto the deal and ease the economic uncertainty caused by U.S. President Donald Trump’s repeated threats to ditch the 1994 accord.

Details of gains and concessions in the deal were only starting to emerge on Monday. Trump threatened he still could put tariffs on Canadian-made cars if Canada did not join its neighbors and warned he expected concessions on Canada’s dairy protections.

“I think with Canada, frankly, the easiest we can do is to tariff their cars coming in. It’s a tremendous amount of money and it’s a very simple negotiation. It could end in one day and we take in a lot of money the following day,” Trump said.

Trump and Canadian Prime Minister Justin Trudeau discussed trade in a telephone call on Monday and “agreed to continue productive conversations,” White House spokeswoman Sarah Sanders said in a statement.

Negotiations among the three partners, whose mutual trade totals more than $1 trillion annually, have dragged on for more than a year, putting pressure on the Mexican peso MXN= and the Canadian dollar CAD=. Both currencies gained against the U.S. dollar after Monday's announcement.

The political stakes are high for all three countries. Trump and Republicans in the U.S. Congress up for re-election in November want to ensure farmers and other voters whose jobs depend on trade with Canada and Mexico that the deal is sealed.

Mexican President Enrique Pena Nieto wants to sign the agreement before leaving office at the end of November, and Trudeau faces a national election expected by October 2019.

Canadian Foreign Minister Chrystia Freeland is expected to travel to Washington for talks on Tuesday. Her spokesman said Canada would sign only a new agreement that is good for the country.

Trump’s economic adviser, Larry Kudlow, told reporters the deal with Mexico should serve as a “reset” for talks with Canada.

90-DAY WINDOW

If talks with Canada are not wrapped up by the end of this week, Trump plans to notify Congress that he has reached a deal with Mexico, but would be open to Canada joining, U.S. Trade Representative Robert Lighthizer told reporters.

The White House said Trump will sign the deal in 90 days. Congress has to approve it.

“There are still issues with Canada but I think they could be resolved very quickly,” a senior trade official told Reuters in an interview.

Some Republicans in Congress called the deal a positive step but said Canada must be part of the new pact.

Trudeau spoke to Pena Nieto on Sunday and shared their commitment to reaching a successful conclusion of NAFTA “for all three parties,” the prime minister’s office said.

Mexican Foreign Minister Luis Videgaray told a news conference in Washington that if Canada and the United States do not reach an agreement on NAFTA, “we already know that there will still be a deal between Mexico and the United States.”

NEW AUTO RULES

The Mexico-U.S. discussions focused on crafting new rules for the automotive industry, which Trump has put at the heart of his drive to rework a pact he has repeatedly described as a “disaster” for American workers.

Matt Blunt, president of the American Automotive Policy Council, which represents General Motors Co (GM.N), Ford Motor Co (F.N) and Fiat Chrysler Automobiles NV (FCHA.MI), said the group was optimistic about the new deal, though it was still reviewing the details.

U.S. President Donald Trump gets some assistance with a speakerphone call to Mexican President Enrique Pena Nieto to announce a deal to replace the North American Free Trade Agreement (NAFTA) at the White House in Washington, U.S., August 27, 2018. REUTERS/Kevin Lamarque

The deal would require 75 percent of auto content to be made in the NAFTA region, up from the current level of 62.5 percent, a U.S. trade official said. A fact sheet describing the bilateral agreement specified the content would be made in the United States and Mexico.

That requirement could shift some auto parts manufacturing to Mexico from China, a White House official told Reuters, speaking on condition of anonymity.

The Trump administration said the deal improves labor provisions, in part by requiring 40 percent to 45 percent of auto content to be made by workers earning at least $16 per hour.

That measure could move some production back to the United States from Mexico and should lift Mexican wages, the White House official said.

A source in South Korea’s auto industry said many automakers would find it difficult to meet the rule on workers’ wages, which are much cheaper in Mexico. The trade minister said South Korea was analysing the deal’s impact on its auto industry.

Some Japanese automakers could face a similar challenge, but their responses on Tuesday were mostly positive.

“Toyota is pleased to hear that progress is being made by U.S. and Mexico negotiators to reach a consensus on modernizing NAFTA,” the car maker said.

“We are hopeful that any changes are fair and balanced.”

Nissan said it was “encouraged that an agreement was reached, and hope that it appropriately considers the impact on our employees, suppliers and customers.”

The United States relented on its demand for an automatic expiration for the deal, known as a “sunset clause.”

Instead, the United States and Mexico agreed to a 16-year lifespan for the deal, with a review every six years that can extend the pact for 16 years, Lighthizer said.

Slideshow (5 Images)

Mexico agreed to eliminate dispute settlement panels for certain anti-dumping cases, a move that could complicate talks with Canada, which had insisted on the panels.

Monday’s announcement lifted equity markets in all three countries, with shares in automotive companies standing out on relief that the deal appeared to end the uncertainty that has dogged the sector for months.

General Motors Co (GM.N), Ford Motor Co (F.N), and Fiat Chrysler Automobiles NV (FCAU.N) gained between 3.3 percent and 4.8 percent, while Canadian auto parts makers such as Magna International Inc (MG.TO) gained 4.6 percent.
The United States, Canada and Mexico sign the United States–Mexico–Canada Agreement in Buenos Aires, replacing the North American Free Trade Agreement.