A special clause in the new US-Mexico-Canada trade agreement (USMCA) gives Washington provision to forbid free trade pacts with “non-market” countries, such as China.
The provision specifies that Canada and Mexico must inform Washington if they enter into such pacts and gives the US the right to leave the USMCA, if they do so, reports Dagens Industri.
The clause is seen as an attempt by the US to put pressure on China by isolating the country, while Beijing is concerned that the US will use it in forthcoming agreements with Japan and the EU.
Björn Fägersten, head of the Swedish Institute for International Affairs’ Europe Programme, says the clause can be seen as part of a broader US strategy but he does not believe it could be used in an agreement with the EU. “The EU would have a totally different negotiating position than Mexico and Canada and would probably not accept a clause that was perceived as a US veto over our China policy, …,” he tells the newspaper.
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