US, Mexico reach agreement on trade deal: Report

By U.S. EconomyFOXBusiness

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The U.S. and Mexico reportedly reached an agreement on a new trade deal on Monday, bringing months of talks on a replacement for NAFTA to an end.

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Trump hinted on Monday morning that a trade deal with Mexico could be reached shortly.

“A big deal looking good with Mexico!” Trump tweeted.

The president’s comments echo those of House Majority Leader Kevin McCarthy, who said Sunday a new trade agreement was nearing.

“I think it’d be very soon,” McCarthy, R-Calif., told Maria Bartiromo on “Sunday Morning Futures.” “We’d vote on it in the next Congress.”

He noted the need for a “modernization” of the trade agreement, which was enacted in 1994 under President Bill Clinton. The deal created a trilateral trade bloc between the U.S., Mexico and Canada.

NAFTA has come under fierce scrutiny by President Trump since his time on the campaign trail, even calling the agreement the “worst trade deal ever made.” Attempts to form a new pact faltered numerous times between the three countries, and talks with Mexico have been focused on creating new rules for the auto industry. Trump has argued that lower wages for employees in Mexico have cost jobs at General Motors, Ford and Fiat Chrysler – “The Big Three” – all of which have production sites in Mexico. The president said in June that the deal could remain trilateral or could be renegotiated into two separate arrangements.

Mexico’s Economy Minister Ildefonso Guajardo told reporters on Sunday a deal between the U.S. and Mexico was nearing completion.

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“I would say that we're practically in the final hours of this negotiation,” he said while arriving for talks at U.S. Trade Representative Robert Lighthizer’s office in Washington. A few hours later, Guajardo said a deal still had yet to be reached.

In addition to its close ties to the U.S. auto industry, Mexico also has been the top importer of U.S. corn for years and the No. 2 purchaser of American soybeans, though it has recently begun turning to Brazil and Argentina as well as working to increase its own supply. Mexico bought 584,000 metric tons of corn from Brazil last year – a 970% spike over 2016, Reuters reported.

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