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What the U.S.-Mexico Trade Pact Says

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The U.S. trade agreement with Mexico is for 16 years, to provide business with a stable rules environment to operate in. It includes a clause for review after 6 years. The content made in the U.S. is increased to 70% from 62.5%. This has to be made by workers earning at least $16  an hour. Aluminium and steel going into the cars has to come from the U.S. helping push U.S. steel plant capacity utilization to 80%.

Labor collective bargaining is strengthened in Mexico through new provisions, a provision supported by new Mexican socialist president Obrador. Free trade in agricultural products is maintained. $4.7 billion was added in help to U.S. farmers as aid for the effects of China's tariff retaliation.

New rules are set for textiles, chemicals, and steel intensive products that set requirements to qualify for tariff free import into the U.S. This is intended to help bring more jobs and investment in these industries in the U.S.

 

 


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President Trump pushes forward with a trade deal with Mexico to replace NAFTA, leaving out Canada. The new deal changes provisions that allowed Mexico to challenge U.S. trade penalties. It also require the 40-45% of U.S. content to be made using wages of at least $16 per hour. Automakers had invested tens of billions in Mexico to turn it into an export hub using lower cost labor, hurting American workers. The deal is aimed at increasing investment in American jobs in the auto industry.

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