NAFTA deal reached: Canada, U.S., Mexico reach trade agreement under new name

After more than a year of negotiating a new North American Free Trade Agreement (NAFTA), Canada, the U.S. and Mexico have finally inked a trade deal.

Foreign Affairs Minister Chrystia Freeland and United States Trade Representative Robert Lighthizer released a joint statement Sunday night announcing the new deal, which will be called the United States-Mexico-Canada Agreement (USMCA).

WATCH: Canada, U.S. reach new NAFTA deal with a new name

1:18 Canada, U.S. reach new NAFTA deal with a new name

“Today, Canada and the United States reached an agreement, alongside Mexico, on a new, modernized trade agreement for the 21st Century: the United States-Mexico-Canada Agreement (USMCA),” the statement read.

“USMCA will give our workers, farmers, ranchers, and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region.”

U.S. President Donald Trump is to sign the $1.2-trillion trade agreement at the end of November and will then submit it to Congress, an official said.

WATCH: Canadian NAFTA negotiations coming down to the wire

2:26 Canadian NAFTA negotiations coming down to the wire

The deal came down to the wire before a midnight deadline Sunday set by U.S. Congress, with Prime Minister Justin Trudeau convening a cabinet meeting at 10 p.m. ET Sunday in Ottawa.

“It’s a good day for Canada,” Trudeau told reporters after the cabinet meeting to discuss the deal, which triggered a jump in global financial markets.

The NAFTA negotiations have been in the works since Aug. 16, 2017. The goal was to “modernize” the trade pact, with U.S., Mexican and Canadian. Officials initially expected to conclude negotiations in early 2018 due to elections later in the year.

WATCH: What we know so far about the new NAFTA deal

4:12 What we know so far about the new NAFTA deal

What’s in the new agreement?

Senior White House officials said the deal is a big win for Mexico and Canada, and the deal includes ambitious new market access, including increased U.S. access to the dairy market in Canada. The officials said that a new regime has been agreed upon that will prevent supply management from being externalized outside of Canada.

Canada has agreed to provide U.S. dairy farmers access to about 3.5 per cent of its approximately $16-billion annual domestic dairy market. Although Canadian sources said its government was prepared to offer compensation, dairy farmers reacted angrily.

WATCH: Trump touts USMCA as America’s biggest trade deal ever

1:51 Trump touts USMCA as America’s biggest trade deal ever

The Dairy Farmers of Canada said the new trade agreement will grant greater market access to the domestic dairy market and eliminate competitive dairy classes, which the group said will shrink the Canadian industry.

The lobby group said the measures will have “a dramatic impact not only for dairy farmers but for the whole sector,” adding that it fails “to see how this deal can be good for the 220,000 Canadian families that depend on dairy for their livelihood.”

READ MORE: Here are key details of the new North America free trade deal

Chapter 19, the dispute resolution mechanism, which was a major sticking point in the negotiations, will be kept with no substantial changes.

The deal also requires a higher proportion of the parts in a car to be made in areas of North America paying workers at least $16 an hour, a rule aimed at shifting jobs from Mexico.

Canada and Mexico each agreed to a quota of 2.6 million passenger vehicles exported to the United States in the event that Trump imposes 25 per cent global autos tariffs on national security grounds.

WATCH: Trump’s auto tariffs could impact Canadian consumers

2:45 Trump’s auto tariffs could impact Canadian consumers

The quota would allow for significant growth in tariff-free automotive exports from Canada above current production levels of about two million units, safeguarding Canadian plants. It is also well above the 1.8 million cars and SUVs Mexico sent north last year.

But the deal failed to resolve U.S. tariffs on Canada’s steel and aluminum exports.

A review of the deal will come up every six years, officials said.

–With files from Reuters and Eric Stober