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China tensions keep Mexico in spotlight, 3 years on from USMCA

Low labor costs draw manufacturers avoiding U.S. tariffs aimed at Beijing

U.S. President Joe Biden's administration has sought to draw manufacturing investment to North America as a whole for economic security purposes.   © Reuters

MEXICO CITY/WASHINGTON -- As the revamped North American trade pact known as the USMCA marks its third anniversary, the trade bloc has come back into focus amid tensions with China, but the deal has fallen short on Washington's original goal of attracting manufacturers to the U.S.

The U.S.-Mexico-Canada Agreement that took effect July 1, 2020, set stricter requirements for zero-tariff trade within the region than its predecessor, the North American Free Trade Agreement. This was a bid by then-U.S. President Donald Trump to bring more manufacturing to U.S. shores.

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