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The United States – Mexico – Canada Agreement (USMCA) was signed on November 30, 2018 and aims to replace and modernize the North-American Free Trade Agreement (NAFTA). This paper uses a global, multisector, computable-general-equilibrium model to provide an analytical assessment of five key provisions in the new agreement, including tighter rules of origin in the automotive, textiles and apparel sectors, more liberalized agricultural trade, and other trade facilitation measures. The results show that together these provisions would adversely affect trade in the automotive, textiles and apparel sectors, while generating modest aggregate gains in terms of welfare, mostly driven by improved goods market access, with a negligible effect on real GDP. The welfare benefits from USMCA would be greatly enhanced with the elimination of U.S. tariffs on steel and aluminum imports from Canada and Mexico and the elimination of the Canadian and Mexican import surtaxes imposed after the U.S. tariffs were put in place.

Foreign trade regulation. --- Export and import controls --- Foreign trade control --- Foreign trade regulation --- Import and export controls --- International trade --- International trade control --- International trade regulation --- Prohibited exports and imports --- Trade regulation --- Law and legislation --- Exports and Imports --- Public Finance --- Taxation --- Trade Policy --- International Trade Organizations --- Empirical Studies of Trade --- Economic Integration --- Trade: General --- Taxation, Subsidies, and Revenue: General --- Public finance & taxation --- International economics --- Tariffs --- Imports --- Surtax --- Valuation, origin and classification --- North American Free Trade Agreement --- Taxes --- Revenue administration --- Tariff --- Customs appraisal --- Commercial treaties --- United States