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For the first time, the new agreement also stipulates that 40-45% of parts of a non-tariff vehicle must come from a so-called high-wage plant. These plants must pay at least $16 per hour in average wages for production workers. That`s about three times the average wage at a Mexican plant right now, and government officials hope that this provision will force automakers to buy more supplies from Canada or the United States, or raise wages in Mexico. In the 2016 U.S. presidential election, Donald Trump`s campaign included a promise to renegotiate or eliminate NAFTA if the renegotiations fail. [21] After the election, Trump made a series of changes that influenced trade relations with other countries. The exit from the Paris Agreement, the cessation of participation in the Trans-Pacific Partnership negotiations and the significantly larger increase in tariffs with China were some of the steps he took, which reinforced the fact that he was serious about changing NAFTA. [22] Much of the debate about the virtues and errors of the USMCA resembles the debate on all free trade agreements (FTAs), such as the nature of free trade agreements as public goods, potential violations of national sovereignty and the role of commercial, labour, environmental and consumer interests in the development of the language of trade agreements. The agreement between the United States of America, the United States of Mexico and Canada[1], commonly known as the United States-Mexico-Canada Agreement (USMCA), is a free trade agreement between Canada, Mexico and the United States in lieu of the North American Free Trade Agreement (NAFTA). [2] [3] [4] The agreement has been referred to as NAFTA 2.0[5][7][7] or “New ALEFTA[8][9],[9] since many nafta provisions have been introduced and its amendments have been found to be largely incremental. On 1 July 2020, the USMCA came into force in all Member States. Proponents of NAFTA in the United States stressed that the pact was a free trade agreement and not an economic community agreement. [37] The free movement of goods, services and capital did not extend to work.