LAREDO, Texas – A strong trade agreement with Mexico and Canada is clearly a “win” for the US economy, the Perryman Group says.

The United States-Mexico-Canada Agreement still needs to pass Congress and be ratified in Mexico and Canada.

However, it appears that a structure has been finalized to replace the 25-year old North American Free Trade Agreement.

“The USMCA ensures the free flow of trade, protecting business ties among the three nations,” the Perryman Group says, at the start of a new study.

“For example, cross-border supply chains are quite common along the borders, with certain aspects of production occurring in each country depending on relative comparative advantages.”

Without a trade agreement, the Perryman Group notes, such arrangements and other imports and exports would become “more difficult and more costly” because trade would revert to tariff schedules provided by each country to the World Trade Organization (WTO).

The Perryman Group compared a scenario with the USMCA in place to one where the U.S., Canada, and Mexico trade under the terms of the listed tariffs with the WTO.

“For the United States, The Perryman Group estimates that having the USMCA in place leads to an additional $64.9 billion in gross product and almost 600,900 jobs compared to trading under the terms of the WTO stated tariffs,” the Perryman Group states.

“In Texas, annual gross product will be a projected $17.6 billion higher and employment 164,700 higher under the USMCA. For California, the USMCA will likely lead to $6.2 billion in gross product and almost 58,700 jobs compared to current WTO tariffs.”

The introduction to the study states: “Clearly, the USMCA is good for the U.S. economy, particularly in trade-intensive border states such as California and Texas.”

Editor’s Note: Click here to read the full report.