US Trade Representative Robert Lighthizer and Canadian Foreign Minister Chrystia Freeland said in a joint statement that the United States, Canada and Mexico had reached a trilateral trade agreement, dubbed the United States-Mexico-Canada Agreement (USMCA).
"It is a great deal for all three countries, solves the many deficiencies and mistakes in NAFTA, greatly opens markets to our Farmers and Manufacturers, reduces Trade Barriers to the U.S. and will bring all three Great Nations together in competition with the rest of the world. The USMCA is a historic transaction! Congratulations to Mexico and Canada!" Trump said on Twitter.
Last week, Trump warned during a press conference in New York that he would impose new tariffs on Canadian automobiles if Ottawa does not negotiate in a fair manner.
Secretary of Commerce Ross on New Trade Deal
Commenting on the deal, Secretary of Commerce Wilbur Ross said in an interview on Monday that the agreement would benefit the American electronic commerce industry.
"That's a big win for American e-commerce companies," Ross told Fox Business News.
He explained Mexico has raised its de minimis threshold from $50 to $100, meaning online purchases of up to $100 can be brought into Mexico from the United States with no tariff or value-added tax (VAT). Ross added Canada has also improved conditions for bilateral online trade, however, not as much as Mexico.
READ MORE: US, Mexico, Canada Reach New Trade Deal to Replace NAFTA
The three countries have been engaged in talks to modernize NAFTA for more than a year. NAFTA has been in place since 1994, but Trump threatened to leave the agreement if the new negotiations failed to produce a deal that would be more favorable to the United States.
The USMCA is reportedly set to be signed by the leaders of the three countries in 60 days.