Question

What has not changed from NAFTA to USMCA? Is USMCA better for Mexico compared with NAFTA? Is the Mexican government likely to approve the USMCA?

Answer 1

Similarities between NAFTA and USMCA :-

1) The new agreement also eliminates tariffs on imports and exports between the two countries.

2) Both agreements involves establishment of procedures to resolve trade dispute

3) All the countries that have signed the agreement will continue to respect each others patents , trademarks and copyrights .

4) Both involves modernisation of border procedures.

5) Both agreements grants the status of Most Favoured Nation to co - signers .

Mexico's new position with USMCA :-

Mexico had to suffer some major drawbacks due to the new agreement :-

1) It had to make lot of concessions to US president Mr. Donald Trump

2) The new agreement stalled Mexico's manufacturing sector to a large extent.

3) It is unclear whether wages will actually rise for Mexico labours

4) It increases environmental and labour regulations .

5) It imposes a quota on Mexico's automotive production.

Implementation of USMCA by Mexican government :-

To implement the new policies ,the Mexican government are facing lot of opposition . Thus the Mexican government are making the following changes for successful implementation of the USMCA government .

1) Mexico is poised to pass major labour reform for removing one of the roadblocks that House Democrats have said in an obstacle for an effective implementation .

2) Mexico tomato growers are offered a proposal for raising the price floor for selling tomatoes .