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Industry Talk

New trade agreement to replace NAFTA

The United States, Mexico and Canada have concluded negotiations on a trade agreement to replace NAFTA.

2nd October 2018

Innovation in Textiles
 |  Washington, DC

Clothing/​Footwear

“The US textiles industry is pleased the United States, Mexico and Canada have reached an agreement because Canada and Mexico are its largest trading partners,” said National Council of Textile Organizations (NCTO) President and CEO Auggie Tantillo. He noted that products from the textiles and apparel supply chain accounted for nearly US$ 12 billion in US exports to Canada and Mexico in 2017.

“Unlike the original NAFTA, the new agreement includes a separate textile and apparel chapter. This outcome is a tangible recognition by all three parties of the importance of textile manufacturing to the regional economy,” added Tantillo.

NAFTA is a trilateral free trade agreement that came into force on 1 January 1994, signed by Canada, Mexico, and the US. The goal of NAFTA was to eliminate barriers to trade and investment between the US, Canada and Mexico.

The implementation of NAFTA brought the immediate elimination of tariffs on more than one-half of Mexico's exports to the US and more than one-third of US exports to Mexico. According to some economic analyses, NAFTA has been a small net positive for the US, large net positive for Mexico and had an insignificant impact on Canada.

In May 2017, US Trade Representative Robert Lighthizer formally notified Congress that President Trump intends to renegotiate NAFTA. In the letter to Congress, Ambassador Lighthizer expressed the Trump Administration’s commitment to concluding the negotiations with timely and substantive results for US consumers, businesses and workers.

www.ncto.org

Further reading

NCTO President and former US apparel trade negotiator testify at NAFTA hearing

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