After 14 months of intense negotiations, Prime Minister Justin Trudeau has finally announced the new NAFTA deal between Canada, the United States and Mexico. As he stated when talking to the media, it's "a good day for Canada". Here's everything you need to know about the new deal and what it means for us.
First of all, the new trade deal will no longer be called the North America Free Trade Agreement (NAFTA), it's now the United States-Mexico-Canada Agreement (USMCA).
President Donald Trump decided to cool it with his threats of placing hard limits on Canadian auto exports to the U.S. If he had of gone forward with this, Canadians would have seen a 20-25 percent duty on cars and auto parts imported to the U.S.
With $71 billion of Canadian cars and parts exported to the U.S. last year alone, this would have significantly affected Ontario, as the province has approximately 120,00 auto jobs.
Turns out that Trump's new USMCA is not much different than NAFTA, and it benefits Canada in multiple ways. https://t.co/G4rvm5ASZy— Ed Krassenstein (@EdKrassen) October 1, 2018
A deal was also met to give American farmers greater access to Canada's $16 billion dairy market. They've long struggled with oversupply in their dairy industry, so this allows them to unload some of their products on Canada.
Canada also agreed to end "class 7 pricing". This was a milk class created to slash prices on some Canadian milk ingredients. This had a negative impact on the American industry because it made their dairy products uncompetitive in pricing, an issue that President Trump has called "problematic" for America.
The deal isn't a hit with Dairy Farmers of Canada. They are planning to renegotiate the trade pact as they feel it will shrink the Canadian industry by limiting exports and opening up the market to more Amerian products.
READ MORE: This Is Why Canada Is Not Wanted In NAFTA
Tariffs on steel and aluminum imports into Canada are still up in the air and no agreement has been met. However, sources say they do plan on resolving the issue before formalizing USMCA.
In a joint statement, Canada's foreign affairs minister and the U.S. trade representative said, " USMCA will give our workers, farmers, ranchers, and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region."
They also mentioned that the new deal will strengthen the middle class and create more well-paying jobs for North Americans.
A good day for Canada & our closest trading partners. More tomorrow... https://t.co/qOowhvYW2B— Justin Trudeau (@JustinTrudeau) October 1, 2018
Trudeau is expected to comment more on the trade deal later on today. If all goes well when the deal is reviewed by Congress, the deal will be signed by December 1st, 2018.