Monday, December 11, 2023

White House hopeful for approval of USMCA trade deal

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By Barbara Olejnik

Poultry Times staff

WASHINGTON — The Trump administration remains optimistic that Congress will approve the U.S.-Mexico-Canada (USMCA) trade agreement when it returns from its August recess.

Lawrence Kudlow, President Trump’s top economic advisor, has said the White House hopes legislation to ratify the trade agreement will be completed in September.

U.S. Vice President Mike Pence has said he was hopeful that the U.S. House of Representatives, which is controlled by Democrats, would pass the agreement this fall.

The clock is ticking” Pence said. “Canada has already begun to make it through the legislative process; Mexico has already begun making changes that we asked for. . . We believe if House Speaker Nancy Pelosi brings it to the floor it will pass.”

The USMCA agreement would replace the 95-year-old North American Free Trade Agreement. The USMCA agreement fulfills a campaign promise made by President Trump who pledged to renegotiate and replace NAFTA or terminate it.

The agreement was signed in November by President Trump, former Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau. However, the agreement must be ratified by each country’s legislative body. Mexico completed this requirement under leadership of the new president, Lopez Obrador.

U.S. Trade Representative Robert Lighthizer, in a statement following Mexico’s ratification of the agreement, said: “The USMCA is the strongest and most advanced trade agreement ever negotiated. It is good for the United States, Mexico and Canada in a way that truly benefits our workers, farmers and businesses. The USMCA’s ratification by Mexico is a crucial step forward, and I congratulate President Lopez Obrador and the Mexican Senate on this historic achievement.”

Included in the new agreement is a requirement that cars and trucks must have 75 percent of their parts made in North America, an increase from the NAFTA requirement of 62.5 percent.

In addition, a minimum amount of 40-45 percent of a car must be produced by workers making $16 an hour.

Under the deal, Canada agrees to open its dairy market and U.S. exporters of chicken, eggs, turkeys and U.S. wheat gain more access to the Canadian market.

The new agreement would also provide stronger and more comprehensive intellectual property protection than prior U.S. trade agreements.

On May 30, Lightlizer sent letters to congressional leaders along with a draft Statement of Administrative Action (SAA). The draft SSA is an outline of legal changes required to implement the trade agreement into existing U.S. law, the implementing bill.

House Speaker Pelosi appointed a Democratic working group to study the USMCA agreement and submit proposals for changes to the trade deal.

Democrats have voiced concerns over issues relating to labor, the environment and access to medicine.

Democrats have also expressed concern over language that would give pharmaceutical companies 10 years protection from cheaper competition in a category of ultra-expensive drugs call biologics.

Pelosi is not expected to advance the legislation until Democratic concerns are addressed.

The U.S. International Trade Commission projects that the USMCA will create 176,000 new jobs and increase the U.S. economy by $68.2 billion.

The commission also estimates that the USMCA would increase annual U.S. exports to Canada by more than $19 billion and annual exports to Mexico by more than $14 billion.

American Farm Bureau Federation President Zippy Duvall has said “it’s time to wrap up negotiations and ratify USMCA.  . . Farmers and ranchers are carrying the heaviest burden from the ongoing trade wars. We need USMCA now to strengthen relationships with our North American trading partners and improve access to these markets.”

Former U.S. Agriculture Secretary Tom Vilsack, president of the U.S. Dairy Export Council, echoed this sentiment in recent testimony before the Senate.

“America’s current trade agenda begins with passage of USMCA. When USMCA comes up for a vote, U.S. agriculture is asking that you act quickly to ratify this trade agreement,” Vilsack told the senators.

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