January 20, 2020

President Donald Trump Expected To Sign USMCA This Week

The U.S. Senate last week voted to ratify the United States-Mexico-Canada Agreement (USMCA) on a bipartisan, 89-10 vote. President Donald Trump is expected to sign the trade pact this week. (As a reminder, the U.S. House of Representatives passed the bill by an overwhelming bipartisan vote of 385-41 in December.)

That makes Canada the last of the three nations to act on ratification. The House of Commons is expected to vote on the USMCA (and approve it) when it reconvenes on January 27. The trade agreement will go into effect 90 days after all three governments have signed it.

As The Wall Street Journal explained last month, the USMCA includes a chapter on currency manipulation that “forces the signatory countries to disclose government foreign-exchange transactions and could lead to penalties for a failure to do so.” Though U.S. officials have not criticized either Canadian or Mexican currency practices, they maintain this provision is important because it will serve “as a model” for other trade pacts. (Indeed, current language that is in the China phase one pact that was signed last week mirrors the UMSCA provision.)

The Journal also notes the USMCA includes a provision blocking its members from making certain kinds of deals with other countries that are seen as distorting their domestic markets in favor of their own businesses.