TFIGlobal
TFIGlobal
TFIPOST English
TFIPOST हिन्दी
No Result
View All Result
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean
TFIGlobal
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean
No Result
View All Result
TFIGlobal
TFIGlobal
No Result
View All Result
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean

Without Trump in the White House, Mexico and Canada take the US for a ride

Isha Jain by Isha Jain
January 16, 2022
in Geopolitics
USA, Mexico, Canada, US
Share on FacebookShare on X

The United States–Mexico–Canada Agreement (USMCA), which is a free trade agreement, was signed during Trump’s presidency by all three countries to seamlessly replace the 25-year-old North American free-trade agreement. The new USMCA was supposed to make the trade between the three neighbouring countries more easy, fast and conflict-free, but it seems that the new FTA is all set to create a divide between the three countries.

In a serious and escalating conflict with the US, Canada has joined hands with Mexico over the dispute of how much percent of a car or a truck must be made in North America to qualify for the duty-free treatment under USMCA. It is the second time in six months that a conflict has risen between the three countries over automotive trade. Automobiles and auto parts have a vital portion of manufactured goods that are traded between the US, Canada and Mexico.

Also Read

NATO Chief Rutte: Alliance Members Progressing Toward 5% Defence Spending Goal

Trump offers Canada “Golden Dome” cover if it becomes the 51st state of the US

Trump Sparks Nuclear Deterrence Debate in Europe

Canada and Mexico are also in another dispute with the US over Biden’s efforts to bolster US auto sector jobs by giving tax incentives to the buyers of made in US electric vehicles. The governments of Canada and Mexico are also concerned about the possibility of automotive companies in their respective country shifting their manufacturing plants to the US, which will cause huge losses in jobs and taxes.

Also Read: Canadian media treat their own country like it is the 51st state of the United States of America

Business and Trade experts have shown concerns and have said that it’s disturbing to see conflicts & disagreements over a key element of the 2018 trade pact so early in its history. This also shows that the three countries don’t have faith in one another when it comes to trade and FTA.

“The auto industry is the heart and soul of North American integration,” said Christopher Sands, director of the Canada Institute at the Woodrow Wilson International Center for Scholars. He added, “If the auto industry part of Canada-U.S. free trade breaks down, the whole agreement breaks down. You cannot exaggerate the importance of these disputes.”

On Thursday, Mary Ng, the international trade minister, announced that Ottawa is joining Mexico in a request for judicial arbitration of how the US calculates North American content. Both the countries of Mexico and Canada have demanded the establishment to constitute a legally binding dispute settlement panel to rule on US interpretation of automotive rules of origin under Chapter 31 of the USCMA. Under the new FTA of USCMA, 75 percent of a car or light truck and the core components like engines or transmissions, must be manufactured in North America to avoid duties. The number of 75 percent is a significant increase from 62.5 percent under the old NAFTA.

Read More: How the United States kept the EU militarily weak for decades and why it could change soon

“The outcome was the result of negotiations and close consultations with automotive stakeholders, which ensured that these new rules of origin would deepen regional integration and support the competitiveness of automotive producers in North America” Ms. Ng said. Welcoming Canada’s move, Mexican Economy Minister Tatiana Clouthier said, “Together we will defend the competitiveness of this regional industry”. 

According to Lawrence Herman, an international trade lawyer, the Biden administration is under heavy pressure from the US autoworkers unions as they want the government to defend a stricter interpretation of North American regional content rules.

If the three countries fail to settle the conflict and find a durable solution to this problem, then the automotive companies could respond by rejecting to comply with USMCA. They may instead go with the option to pay extra duties incurred as a result of using imported parts. This step would further result in loss of North American jobs, rise in unemployment in the automotive sector and loss of taxes and revenues for the governments.

Tags: CanadaDonald TrumpMexicoShort takesUS
ShareTweetSend
Isha Jain

Isha Jain

Associate Editor, TFI Media A staunch patriot in this woke generation

Also Read

Russia rewards it soldiers for F-16 takedowns as S-400 proves it capabilities against Ukraine and Pakistan

Russia rewards it soldiers for F-16 takedowns as S-400 proves it capabilities against Ukraine and Pakistan

May 31, 2025
Israel Approves 22 New Settlements in West Bank

Israel Approves 22 New Settlements in West Bank Amid International Concerns

May 30, 2025
Vucic betrays Putin? Russian agencies find Serbia firms providing ammunition to Ukraine

Vucic betrays Putin? Russian agencies find Serbia firms providing ammunition to Ukraine

May 30, 2025
How Turkey Undermines the Alliances It Claims to Support

Is Turkey Playing Both Sides—or Playing Everyone?

May 30, 2025
Russian deputy mayor and war hero Zaur Gurtsiev assassinated in blast, Ukraine hand suspected

Russian deputy mayor and war hero Zaur Gurtsiev assassinated in blast, Ukraine hand suspected

May 30, 2025
UK pushes military presence in the Arctic provokes Russia

UK pushes military presence in the Arctic provokes Russia

May 29, 2025
Youtube Twitter Facebook
TFIGlobalTFIGlobal
Right Arm. Round the World. FAST.
  • About Us
  • Contact Us
  • TFIPOST – English
  • TFIPOST हिन्दी
  • Careers
  • Brand Partnerships
  • Terms of use
  • Privacy Policy

©2025 - TFI MEDIA PRIVATE LIMITED

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

No Result
View All Result
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean
TFIPOST English
TFIPOST हिन्दी

©2025 - TFI MEDIA PRIVATE LIMITED

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. View our Privacy and Cookie Policy.