USA & Mexico Reach Preliminary Trade Agreement

The United States and Mexico have reached a preliminary trade deal after months of stalemate negotiation. The deal will mostly likely no longer bear the name NAFTA, but will still provide trade benefits to each country. The deal also keeps the door open for negotiations with Canada to continue. Mexico’s president, Pena Nieto, was quoted in saying that the new trade agreement was “positive” for both countries, and also stated, “It’s our wish that Canada will also be incorporated in all of this.”

In order to come to this agreement, it is evident that Trump agreed to back off some of his original demands in order to compromise for the best of both nations. For example, the two nations have agreed to a truce on alcohol. According to the office of the U.S. Trade Representative, “the two countries agreed to new labeling and certification provisions for the wine and distilled spirits trade…Mexico agreed to continue recognition of Bourbon Whiskey and Tennessee Whiskey as distinctive U.S. products, while the U.S. agreed to continue recognition of Tequila and Mezcal as distinctive products of Mexico.”

With details in the works, and Canada’s involvement still up in the air, this new deal is a constructive step forward, but still holds some unresolved questions. We will continue to keep tabs on this situation and provide updates as necessary.

Source: Gillis, Chris. “US., Mexico reach trade deal.” American Shipper. August 27, 2018