The Trump Administration issued its annual trade policy report to Congress on March 1, including approval of USMCA, the revised North American trade pact, as a key goal for 2019. In its report, the Administration refers to USMCA as a new regime and the most advanced trade agreement ever negotiated by the U.S.
Congress has yet to see the draft text of the USMCA implementing bill, and lawmakers are taking positions on certain aspects of the trade agreement that would govern North American commerce. Some Democrats have expressed concerns with the enforceability of the agreement’s labor and environmental provisions. Lawmakers want confidence that the Administration will effectively enforce the agreement, including Mexico’s commitments to enact new labor laws. Another concern is whether USMCA would lock in higher drug prices.
The timeline for congressional consideration of USMCA remains unclear. An economic analysis of the agreement’s impacts on industry sectors is forthcoming from the U.S. International Trade Commission, the results of which could influence lawmakers on their decision to support or oppose the agreement. Given the approaching 2020 presidential campaign, others would like to see a successful vote on the deal before summer to deliver another campaign promise achievement for President Trump.
U.S. tariffs on steel and aluminum and the President’s threat to withdraw from NAFTA loom over the USMCA ratification process. The U.S. temporarily delayed tariffs on Canadian and Mexican imports during USMCA negotiations but later imposed the tariffs to pressure the countries to sign a deal. Now that USMCA has been finalized, calls to remove the tariffs on steel and aluminum have heightened, especially as Canada and Mexico have retaliated in kind by placing tariffs on numerous U.S. products including pork, cheese, and potatoes. Shortly after signing USMCA, President Trump announced that he would withdraw from NAFTA very soon. Many lawmakers disagree with this negotiating tactic and question the President’s authority to withdraw from NAFTA without approval from Congress.
USRPA will continue to engage on behalf of U.S. rice farmers as congressional approval of USMCA advances.