The United States-Mexico-Canada Agreement (USMCA) is a trade agreement that was signed on November 30, 2018, by the three countries’ leaders and replaces the previous agreement, the North American Free Trade Agreement (NAFTA). The agreement, which went into effect on July 1, 2020, aims to modernize and improve the trading relationship between the three countries.
The USMCA text is a comprehensive document, comprising 34 chapters, nine annexes, and numerous side letters. The full text of the agreement is available to the public and can be accessed online for free. The text covers a wide range of topics, including intellectual property, digital trade, labor rights, and environmental protection.
One of the most significant changes introduced by the USMCA is the new rules of origin for the automobile industry. Under the new agreement, vehicles must have 75% North American content (up from 62.5% under NAFTA) to qualify for duty-free treatment. In addition, 40-45% of the content must be produced by workers earning at least $16 per hour.
The USMCA also includes provisions on labor and environmental standards that are intended to ensure that trade benefits workers and protects the environment. The agreement includes provisions that require the three countries to enforce their labor laws and provide workers with the right to collective bargaining. In addition, the agreement has various environmental provisions, including commitments to combat marine litter and address illegal wildlife trade.
Furthermore, the USMCA includes provisions on digital trade that reflect the growing importance of e-commerce and data flows in the modern economy. The agreement`s provisions aim to promote cross-border data flows, prohibit data localization requirements, and promote the use of electronic signatures and authentication.
In conclusion, the USMCA represents a significant overhaul of the North American trading relationship. The agreement`s full text is available to the public and covers a wide range of topics, from intellectual property to labor and environmental standards to digital trade. The USMCA`s rules of origin for the automobile industry, labor and environmental standards, and provisions on digital trade are just a few examples of the agreement`s impact on the trading relationship between the three countries.