Kenmode Blog The Evolution from NAFTA to USMCA

The North American Free Trade Agreement (NAFTA), which took effect in 1994, was a landmark trade deal between Canada, Mexico, and the United States. It aimed to eliminate most tariffs on products traded among the three countries, with a focus on liberalizing trade in agriculture, textiles, and automobile manufacturing. NAFTA fundamentally reshaped North American economic relations, driving unprecedented integration between the developed economies of Canada and the United States and Mexico’s developing one. However, NAFTA faced criticism in the United States for contributing to job losses and outsourcing. President Donald J. Trump referred to it as the “worst trade deal ever made” and renegotiated it as the United States-Mexico-Canada Agreement (USMCA). The USMCA, which entered into force on July 1, 2020, aimed to address some of the perceived shortcomings of NAFTA while preserving the benefits of trilateral trade.