Trump Just Signed the U.S.M.C.A. Here’s What’s in the New NAFTA

   A trade agreement with Mexico and Canada revises Mexico’s labor laws and encourages more auto production in North America.

WASHINGTON — President Trump signed the revised North American Free Trade Agreement into law on Wednesday, fulfilling a campaign promise to rewrite “one of the worst trade deals” in history.

“Today we are finally ending the NAFTA nightmare,” Mr. Trump said during a White House signing ceremony, calling the new trade deal a “colossal victory” for farmers, factory workers, and other countries.

Much of the new United States-Mexico-Canada Agreement simply updates the 25-year-old NAFTA, with new laws on intellectual property protection, the internet, investment, state-owned enterprises and currency.

But the 2,082-page pact also includes significant changes in several key areas, including provisions designed to incentivize car production in North America and open Canadian markets for American dairy farmers.

It rolls back a special system of arbitration for corporations that has drawn bipartisan condemnation, and also includes additional provisions designed to help identify and prevent labor violations, particularly in Mexico. Some of those changes were inserted at the insistence of Democrats, who used their control of the House to secure long-desired policy changes.

Here are highlights from the new U.S.M.C.A.

Steering more car production to the United States

Nafta required automakers to produce 62.5 percent of a vehicle’s content in North America to qualify for zero tariffs. The new agreement raises that threshold, over time, to 75 percent. That’s meant to force automakers to source fewer parts for an “Assembled in Mexico” car from Germany, Japan, South Korea or China. The pact also requires 70 percent of a vehicle’s steel and aluminum to originate in North America, with steel being both melted and poured on the continent.

For the first time, the new agreement also mandates that 40-45 percent of the parts for any tariff-free vehicle must come from a so-called high-wage factory. Those factories must pay a minimum of $16 an hour in average salaries for production workers. That’s about triple the average wage in a Mexican factory right now, and administration officials hope the provision will either force automakers to buy more supplies from Canada or the United States — or cause wages in Mexico to rise.

However, critics caution that factories may be able to game the rules by including some high-paid managers in their calculations. And there are risks to the changes.

Automotive analysts have warned that the wage provision could raise costs for American car companies and car buyers, slowing the auto market and weighing on economic growth over all.