Trade Agreement Nafta

Although President Donald Trump warned Canada on Sept. 1 that he would exclude it from a new trade deal if Canada does not comply with its demands, it is unclear whether the Trump administration has the power to do so without congressional approval. [145]:34-6[146][147][148] According to congressional research service (CRS) reports, one of which was released in 2017 and the other on July 26, 2018, it is likely that Congress would need to obtain President Trump`s approval to make substantial changes to NAFTA before the changes are implemented. [145]:34-6[149] According to Chad Bown of the Peterson Institute for International Economics, the Trump administration`s list is „very much in line with the position of the president, who likes trade barriers and loves protectionism. This makes NAFTA less of a free trade agreement in many ways. [131] The concerns expressed by the U.S. Trade Representative regarding subsidized state-owned enterprises and currency manipulation do not apply to Canada and Mexico, but are intended to send a message to countries outside North America. [131] Jeffrey Schott of the Peterson Institute for International Economics stated that it would not be possible to quickly conclude renegotiations while all the concerns on the list. [133] He also stated that it was difficult to combat trade deficits. [133] Agriculture, in particular, has recovered. Canada is the largest importer of U.S. agricultural products and Canadian agricultural trade with the United States has more than tripled since 1994, as has all of Canada`s agricultural exports to NAFTA partners. Since the first negotiations, agriculture has been a controversial subject within NAFTA, as has been the case for almost all free trade agreements signed under the WTO.

Agriculture was the only party not subject to trilateral negotiations; Instead, three separate agreements were signed between each couple of parties. The Canada-U.S. agreement contained significant restrictions and tariff quotas for agricultural products (mainly sugar, dairy, and poultry products), while the Mexico-U.S. pact allowed for broader liberalization under exit periods (this was the first North-South free trade agreement for agriculture signed). [Clarification needed] In late 2019, the Trump administration won Democratic support in Congress at the USMCA after agreeing to incorporate greater labor law enforcement. In the updated Pact, the parties agreed on a number of changes: the rules of origin for the automotive industry were strengthened, so that 75% of each vehicle must come from the Member States, compared to 62.5%; And new work rules have been added, which require that 40 percent of each vehicle come from factories that pay at least $16 an hour. A proposal to extend intellectual property protection for US pharmaceuticals – a red line for US negotiators – has been sacrificed. The USMCA also significantly reduces the controversial investor-state dispute settlement mechanism, eliminates it completely with Canada, and limits it to certain sectors with Mexico, including oil and gas and telecommunications. If the original Trans-Pacific Partnership (TPP) had entered into force, existing agreements, such as NAFTA, would be reduced to those that would not be contrary to the TPP or that would require greater trade liberalization than the TPP.

[155] However, only Canada and Mexico would have the prospect of becoming members of the TPP after the United States. . . .

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