Unequal trade relationships have created inhumane working conditions in Mexico and Central America, causing large scale human displacement.
The US president delivered his annual State of the Union address to Congress, one day before the Senate will vote on his impeachment. Trump's speech was interrupted by a protestor shouting at him to do something about gun violence.
The agreement includes tougher rules on labour and automotive content but leaves $1.2 trillion in annual US-Mexico-Canada trade flows largely unchanged.
In recent years, fruit and vegetable imports from Mexico have surpassed the total production in the US state of Florida.
The leaders of the United States, Mexico and Canada signed the UMSCA deal replacing the old NAFTA in a triumph for US President Donald Trump, who insisted on what he said were better conditions for US workers.
The new deal United States-Mexico-Canada Agreement updates and replaces the nearly 25-year-old North American Free Trade Agreement, which US President Donald Trump had promised to cancel and turn into a bilateral pact with Mexico.
Canada and US officials are due to meet to settle major disputes amid pressure from Washington for a quick settlement. Trump said he could exclude Canada from the NAFTA pact but Trudeau will not back down on key issues.
"We know that a win-win-win agreement is within reach," Canada's Foreign Minister Chrystia Freeland told reporters. "We'll keep talking until we reach a good deal," she said.
Wall Street hit record highs pegged on the current North American Free Trade Agreement (NAFTA) negotiations which could lead to a further easing of global trade tensions.
Canada nears resolution in trade dispute with America as Trump threatens to leave NAFTA and have only one trade agreement with Mexico.
US and Mexico agree to scrap the North American Free Trade Agreement, also known as NAFTA, to sign a new deal in which they hope Canada will be included.
While palpable, relief over a US-Mexico trade deal was dimmed by concerns that the China-US trade war will drag on for some time.
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