Former President Donald Trump drew intense criticism from many within the worldwide group for his protectionist stance and strict adherence to an “America First” agenda on the matter of commerce. Amongst different considerations for the Trump administration, one of many main targets of the previous president’s ire was the North American Free Trade Agreement (NAFTA). Reached in 1994, the settlement established a trilateral commerce bloc amongst Canada, Mexico, and america.
Following months of negotiations, the up to date United States-Mexico-Canada Agreement (USMCA), typically known as the “new NAFTA,” got here into impact on July 1, 2020.
In lots of respects, the USMCA is similar to NAFTA, however it makes a number of necessary updates to the sooner settlement to replicate modifications in commerce over the previous three many years. Amongst these are modifications to mental property protections, laws for the commerce of cars and elements, and protections concerning labor legal guidelines. Whereas the impression of the USMCA on U.S.-Mexico commerce continues to be being decided, there’s little query that commerce with Mexico is an important function of the U.S. financial system in addition to international coverage. Beneath, we discover how a lot america trades with Mexico.
- The North American Free Commerce Settlement (NAFTA) was a landmark treaty totally free market commerce between the U.S., Canada, and Mexico.
- Some People noticed NAFTA as giving an unfair benefit to the opposite two nations, and strongly opposed the coverage.
- President Trump took purpose at NAFTA, changing it with the USMCA settlement.
Largest Buying and selling Partener
In keeping with the Workplace of america Commerce Consultant, U.S. items and companies commerce with Mexico reached a complete of greater than $677 billion in 2019. Of this, $289.5 billion have been exports, whereas near $388 billion have been imports. Thus, the U.S. commerce deficit with Mexico was about $98.5 billion for 2019.
Mexico grew to become the biggest trading-goods accomplice of america for the primary time in 2019, with $614.5 billion in complete (two-way) items traded throughout that yr. The US reported a trading-goods deficit with Mexico of $101.4 billion for the yr.
In 2020, Mexico fell to the second-largest buying and selling accomplice with the U.S. behind China. Amid the COVID-19 pandemic 2020 commerce between the international locations resulted in substantial lower in complete bilateral merchandise commerce to $538.1 billion.
Mexico was the second-largest items export market of america in 2019. The US exported $256.6 billion to Mexico in 2019, marking a rise of about 517% since 1993, the final yr earlier than NAFTA took impact. About 16% of all U.S. exports went to Mexico in 2019.
There are a number of necessary areas of export. The highest classes embrace equipment, at $45 billion in exports; electrical equipment, at $42 billion; mineral fuels, at $34 billion; and automobiles, at $21 billion. Plastics are additionally a significant export class, accounting for about $16 billion value of exports to Mexico in 2019.
On the imports aspect, Mexico was the second-largest provider of products imports to america in 2019, with a complete of $358.0 billion in items imported that yr. That constitutes a rise of almost 800% relative to 1993, earlier than NAFTA got here into impact. U.S. imports from Mexico made up greater than 14% of total U.S. imports in 2019.
Among the most necessary classes for imports from Mexico in 2019 embrace automobiles, at $101 billion; equipment, at $66 billion; electrical equipment, at $64 billion; optical and medical devices, at $16 billion; and mineral fuels, at $13 billion. Moreover, there have been about $28 billion in agricultural product imports from Mexico, divided amongst recent vegetables and fruit, wine and beer, snack meals, and processed vegetables and fruit.