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USMCA stops China seeking FTA with Canada and Mexico

Source: Wikimedia Commons

A clause in the upgraded and renamed North American Free Trade Agreement nearly forbids deals with “non-market” countries, such as China. The language deep in the new U.S.-Mexico-Canada Agreement marks another blow in the tit-for-tat trade war the U.S. is leveraging against China.

The clause, which has stirred controversy in Canada, fits in with U.S. President Donald Trump’s efforts to isolate China economically and prevent Chinese companies from using Canada or Mexico as a “back door” to ship products tariff-free to the United States. Specifically, the provision specifies that if one of the current North American Free Trade Agreement partners enters a free trade deal with a “non-market” country such as China, the others can quit in six months and form their own bilateral trade pact.

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