President Donald Trump announced this that he and Mexican President Enrique Peña Nieto have reached a preliminary trade deal. The deal between Mexico and the U.S. would be a revised version of the North American Free Trade Agreement (NAFTA). NAFTA is a trade deal between the United States, Canada and Mexico that has benefited the three countries by creating a trading bloc in North America. Trump also said he plans to change the NAFTA name because as he says, the name has a “bad connotation” and is a “rip off.”
President Trump wants to renegotiate a trade agreement that has been in place for two decades.
BREAKING: Trump says he’s terminating NAFTA and entering a different deal with Mexico, and possibly Canada if they want to negotiate “fairly.” If not, he says he put tariffs on Canada’s cars. pic.twitter.com/MD0ossKsUE
— Jennifer Jacobs (@JenniferJJacobs) August 27, 2018
The 24-year-old trade deal was created to “eliminate barriers to trade and investment between the U.S., Canada and Mexico.”
“They used to call it NAFTA,” President Trump said during a press conference. “We’re going to call it the United States Mexico Trade Agreement.”
This initial agreement between Mexico and the U.S. does not include Canada, even though President Nieto said several times during the press conference that he wants Canada to be involved, The Washington Post reports.
“I spoke to the Prime Minister of Canada @JustinTrudeau about the status of the NAFTA negotiations and the advance between Mexico and the US,” Nieto said via Twitter. “I expressed the importance of his reinstatement in the process, in order to conclude a trilateral negotiation this week.”
However, a spokesperson for the Canadian Foreign Minister, said that they will only sign the new deal if it’s “good for Canada and good for the middle class. Canada’s signature is required.”
The deal also has to be approved by Congress. In the past GOP lawmakers have expressed that they don’t agree with Trump’s views on NAFTA.
“If the president wants to have a good economy for the United States of America, he needs to have a reasonable trade policy that will be good for Texas,” Texas Gov. Abbott told CNBC.
Beto O’Rourke, who’s running for Congress in Texas, also expressed his views about NAFTA, tweeting that terminating NAFTA would “have a real life, long lasting impact on farmers, ranchers, manufacturers, energy producers, small business owners in Texas. It generates $112 billion in exports for our state annually with 1 million jobs in our state connected to trade with Mexico alone.”