US President Donald Trump has signed into law a major rewrite of the rules of trade with Canada and Mexico.
He said it replaces the “nightmare” of a Clinton-era agreement and will keep jobs, wealth and growth in America.
Trump made renegotiating the North American Free Trade Agreement (NAFTA) a priority during his 2016 campaign, although trade experts say the impact of the new US-Mexico-Canada Agreement will be modest.
“This is a cutting-edge, state-of-the-art agreement that protects, defends, and serves the great people of our country,” Trump said in a signing ceremony on Wednesday at the White House, where the invitation list included more than 70 Republican members of Congress but no Democratic legislators.
Canada and Mexico already represent the top two export markets for US goods.
But the new pact, along with the signing of a “phase one” agreement with China, dials down trade tensions that contributed to slowing economic growth globally.
The leaders of the US, Canada and Mexico signed the deal in late 2018.
The agreement that took effect in 1994 under president Bill Clinton tore down trade barriers between the three North American countries and commerce between them surged.
But Trump and other critics said it encouraged factories to leave the US and relocate south of the border to take advantage of low-wage Mexican labour.
The US president threatened to leave NAFTA if he could not get a better deal, creating uncertainty over regional trade.
The independent US International Trade Commission last year calculated the US-Mexico-Canada deal would add 0.35 per cent, or $US68 billion ($A101 billion), to economic growth and generate 176,000 jobs over six years – not much of a change for a $US22 trillion economy with 152 million non-farm jobs.
“It’s a blip,” Syracuse University economist Mary Lovely said.
“The main thing is what it isn’t – it isn’t a continuation of uncertainty and it isn’t a major disruption to business.”
Critics raised concerns the agreement does not address global warming.
Some conservatives said the agreement will make cars and other products more expensive for consumers.