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.”
Reporting by Roberta Rampton, mATT s and Caroline Stauffer in Buenos Aires and David Ljunggren in Ottawa; Editing by Lisa Shumaker, Chizu Nomiyama and Susan Thomas