The U.S. International Trade Commission has released its analysis of the renegotiated North American Free Trade Agreement now known as the USMCA or the US-Mexico-Canada Agreement. The North Country Chamber of Commerce is calling it a critical move toward Congressional approval and restoring certainty and predictability in cross border trade.
The International Trade Commission was required by legislation passed in 2015 to assess the likely impact of the USMCA on the economy and on specific economic sectors. Issued last Thursday, the analysis found that the pact would raise the U.S. GDP by $68.2 billion or 0.35 percent and overall U.S. employment by 176,000 jobs or 0.12 percent. Exports to Canada would increase by 5.9 percent and imports from Canada would rise 4.8 percent.
The North Country Chamber of Commerce has identified approval of the new USMCA as its top national priority because U.S.-Canadian trade is the region’s economic driver. Chamber President Garry Douglas says the analysis reinforces the importance of ratifying the international pact. “It is that step in the process that we needed to get past for many members of Congress to have this in front of them. They’ve been hearing from lots of interests, from business and labor and agriculture and other groups you know all giving reasons why action is needed from Congress on this. This officially reaffirms basically I believe all the messages that these different groups have been telling them, packages it all together in an objective analysis and says yeah this is a good thing folks. Let’s get this approved.”
Douglas says the Chamber and regional economic partners saw cross border development potential lag last year as NAFTA renegotiations dragged on. “We saw the spigot turn off, absolutely saw it turn off. It isn’t that Canadian business interests still didn’t realize or didn’t understand that they needed to be in the U.S. market but it was ‘geez I don’t know what’s going to come out the other end of this. I’d better just wait and see because it might impact some of my decision making.’ And then on October 1st when the agreement was reached and announced the spigot turned back on immediately and we have been very active again welcoming investment in companies and deals and contracts. The only thing that could turn that back around for us would be some stumbling block some delay something that throws off the course of positive action now by Congress in particular to get this approved at the latest by summer but hopefully the sooner the better.”
Although the USMCA agreement has been reached it has not been ratified. Potential stumbling blocks Include final Mexican labor reform approvals and the Canadian House of Commons adjournment in June. Canada also holds national elections in October.
“I don’t think there’s anything that suggests that the USMCA’s going forward at this point.” SUNY Plattsburgh Director of the Center for the Study of Canada Dr. Christopher Kirkey is not optimistic ratification will occur any time soon. “As we speak today we’re still quite a distance off from approval in either Washington or Ottawa. Ottawa has come out recently its foreign affairs minister, global affairs minster Chrystia Freeland said Canada’s view is we’ve done our deal. Canada’s in no great rush to ratify this new agreement. But it’s currently imperiled in Congress. It has little chance of passing without any kind of significant changes. It’s not going to happen. So it’s it’s it’s right now not looking decidedly positive in terms of moving forward.”
Kirkey notes one reason legislators aren’t in a rush: “What it means is NAFTA’s still in force.”
