New trade deals deliver win-wins for U.S., allies

President Donald Trump’s critics, of whom there are plenty, would likely be loathe to do so — but at some point they might have to concede the president has gotten results on the trade front.

Case in point is the sweeping new trade agreement announced late Sunday for the United States, Mexico and Canada to replace the North American Free Trade Agreement, or NAFTA. Mexico had signed on earlier and was prepared to go with a bilateral Mexico-U.S. deal as a reluctant Canadian Prime Minister Trudeau held out.

But pressure mounted on Trudeau at home as Trump played hardball — even refusing to meet with him last week in New York where world leaders had gathered at the United Nations — and the end result is an agreement that makes significant changes and leaders of the three nations say will lead to a stronger North American economy.

The new deal also has a new name. Good-bye NAFTA; hello United States-Mexico-Canada Agreement, or USMCA, that governs $1.2 trillion in trade among the three nations.

Trade pacts, of course, are voluminous. According to a Washington Post analysis, the new deal has 63 pages dealing solely with intellectual property — beefing up protections for patents and trademarks, including areas such as biotech and financial services.

It opens up Canada’s milk market to U.S. dairy farmers, and has significant improvements in labor and environmental rights. For example, Mexican trucks that cross the border into the U.S. must meet higher safety regulations, and Mexican workers must have more ability to organize and form unions — one reason some U.S. labor unions and Democrats are cheering the new rules.

There are big changes for auto manufacturing as Trump seeks to re-balance global trade. A key goal of the new deal is to have more cars and truck parts made in North America. Starting in 2020, to qualify for zero tariffs, a car or truck must have 75 percent of its components manufactured in Canada, Mexico or the United States. And it requires that a significant percentage of work done on the vehicle must be completed by workers earning at least $16 an hour — about three times the typical Mexican auto worker’s current pay.

Translation: fewer cars will be built in North America with cheap labor and cheaper parts manufactured in Asia. That’s a win-win for North America, and it sends a message to China.

It’s worth noting that Mexico’s populist President-elect Andrés Manuel López Obrador made higher wages a centerpiece of his successful campaign that unseated decades of established Mexican political power structure.

Another key provision requires a review of USMCA in six years. NAFTA lingered far too long without needed reforms.

It also has impact right here in New Mexico. Jon Barela, CEO of the Borderplex Alliance , says he’s “optimistic the accord will help bolster the Borderplex region’s position as the fourth-largest manufacturing hub in North America, and continue the positive economic trends of low unemployment and regional economic growth.”

Most key provisions of the new deal won’t take effect until 2020, and the pact is subject to approval by the legislative branch in all three countries. But it’s a strong affirmance of the bond between the three neighbors.

One of Trump’s key campaign promises was to rewrite what he called horrible and unfair trade deals that sucked jobs and money out of the U.S. NAFTA was a poster child for that rhetoric. Make no mistake, overstated or not, it played well in states like Ohio, Michigan, Wisconsin and Pennsylvania. And make no mistake. This is one promise Trump delivered on.

This isn’t Trump’s only success on trade. The president and South Korean President Moon Jae-in signed a new agreement in New York last week on the sidelines of the U.N. General Assembly — one that among other improvements significantly increases the number of cars U.S. automakers can sell there. Better yet, it heads off a tit-for-tat tariff fight with a crucial trading partner and strategic ally.

Meanwhile, Trump’s announced tariffs with the European Union are on hold pending talks slated for later this year. And just last week, Trump and Japanese Prime Minister Shinzo Abe announced an agreement to start bilateral trade talks.

The U.S. trade dispute with China continues to ratchet up, but Beijing cannot help but take notice of these crucial developments with key economic powers.

Give the president his due. Like him or not, this is a victory for his administration, the North American economy, and for American business and workers.