United States, Mexico and Canada Reach new NAFTA Deal
Late last night, just hours before the Trump Administration’s self-imposed deadline, the United States, Canada and Mexico came to agreement on a new trade accord to replace the North American Free Trade Agreement (NAFTA). The new deal is being referred to as the U.S.-Mexico-Canada Agreement (USMCA). The leaders of the three countries expect to formally sign the USMCA on November 29, although it will not come before Congress for a vote until spring 2019.
The Administration has released the full text of the agreement, and they are beginning to issue fact sheets to explain its benefits to the American economy. In striking the deal, trade negotiators tackled thorny issues including dairy import restrictions, dispute settlement procedures, tax-free online shopping, and automotive rules of origin.
Trade experts warn that passage by Congress is not guaranteed, and the results of November’s midterm elections could determine its future. Lawmakers from both parties are expected to scrutinize the agreement’s provisions related to dispute settlement procedures, intellectual property protections, and labor and environmental standards. They will also seek to understand how stricter automotive rules of origin could constrain and complicate North American manufacturing.
We are continuing to review the agreement to evaluate its impact on the electronics industry, but our initial estimation is that this agreement appropriately modernizes NAFTA, allowing for greater integration and growth of the North American marketplace. Please watch for our more in-depth analysis soon.
The fast-track negotiation procedures utilized by the President include strict requirements and timelines. For more information about the timeline, please reference this informative blog post produced by Prime Policy Group, our Washington, D.C. lobbying firm.
Statement – John Mitchell
On behalf of the electronics industry, I want to extend my congratulations and appreciation to the governments of the U.S., Mexico and Canada for their many months of tireless negotiations on a new trilateral trade agreement.
The North American electronics supply chain has grown steadily over the last 25 years. In striking an agreement that modernizes NAFTA to address the current trade concerns of all three countries, USMCA promises to deliver another 25 years of sustainable, mutually beneficial trade.
The USMCA promises to spur even greater integration among the North American economies and strengthen the entire region’s stature as a formidable global manufacturing base. Improving the manufacturing competitiveness of North America, in turn, will unlock more economic growth and job creation, benefiting communities across the continent.
As always, IPC will be working to assess the deal’s likely impacts on our industry, and we will continue to advocate for our members’ interests as the debate goes forward.