House democrats and the Trump administration have reached an agreement to move forward with the White House’s replacement for the North American Free Trade Agreement (NAFTA), the U.S.-Mexico-Canada Agreement (USMCA), according to CNBC.
The Trump administration needs to submit ratifying legislation to Congress for the House to move forward with approving the agreement. Once the White House submits text, a 90 day window to approve USMCA begins.
According to a news release from the USDA, the following key provisions are included in the USMCA.
- America’s dairy farmers will have expanded market opportunities in Canada for a wide variety of dairy products.
- For the first time, the agreement specifically addresses agricultural biotechnology, including new technologies such as gene editing, to support innovation and reduce trade-distorting policies.
- The three countries agree to strengthen disciplines for science based measures that protect human, animal and plant health while improving the flow of trade.
- U.S. poultry producers will have expanded access to Canada for chicken, turkey and eggs.
- Canada agrees to terminate its discriminatory wheat grading system, enabling U.S. growers to be more competitive.
- The three countries agree to avoid technical barriers to trade through non-discrimination and transparency regarding sale, distribution, labeling and certification of wine and distilled spirits.
U.S. secretary of agriculture Sonny Perdue issued the following statement after the announced agreement on USMCA:
“USMCA is a big win for American workers and the economy, especially for our farmers and ranchers. The agreement improves virtually every component of the old NAFTA, and the agriculture industry stands to gain significantly,” said Perdue.
House agriculture committee ranking member K. Michael Conaway released the following statement upon news of the deal:
“Today’s announcement of a deal on USMCA is news America’s farmers and ranchers have been waiting over a year for. I appreciate the work of President Trump and Ambassador Lighthizer in delivering on the promise of an improved trade agreement with Canada and Mexico,” said Conaway.
Assn. of Equipment Manufacturers (AEM) president Dennis Slater issued the following statement hailing the deal:
“This is good news for equipment manufacturers, the 1.3 million men and women of our industry and the entire U.S. economy,” said Slater, “We’re another step closer to getting the USMCA ratified. Getting this across the finish line will preserve duty free market access to our most important trade partners, add more than $68 billion to the U.S. economy and create 176,000 U.S. jobs.”
USMCA will advance U.S. agricultural interests in two of the most important markets for American farmers, ranchers and agribusinesses, according to the USDA. Canada and Mexico are the U.S.’ first and second largest export markets for food and agricultural products, totaling more than $39.7 billion food and agricultural exports in 2018. These exports support more than 325,000 American jobs.
All food and agricultural products that have zero tariffs under the North American Free Trade Agreement (NAFTA) will remain at zero tariffs, according to the USDA. Since the original NAFTA did not eliminate all tariffs on agricultural trade between the U.S. and Canada, the USMCA will create new market access opportunities for U.S. exports to Canada of dairy, poultry and eggs, and in exchange the U.S. will provide new access to Canada for some dairy, peanut and a limited amount of sugar and sugar-containing products.