But it has another over-the-cutting goal: to reduce the imbalance in U.S. international trade, with individual trading partners and around the world. USMCA countries must comply with IMF standards, which aim to prevent exchange rate manipulation. The agreement provides for the disclosure of market interventions. The IMF may be convened as an arbitrator in the event of a dispute between the parties. [57] Sunset clause. The United States has proposed that a revised NAFTA expire after five years, unless it is confirmed by all parties. According to the administration, this would ensure that the agreement will continue to work for all parties. The proposal is rejected by Canada and Mexico, who say it would hurt investor confidence and long-term investment in the region. On May 31, 2018, Prime Minister Trudeau said that Vice President Pence had told him that the sunset clause was a prerequisite for a possible summit to reach an agreement. Trudeau reportedly told Pence that “there is no possibility of a Canadian prime minister signing a NAFTA agreement that includes a five-year sunset clause.” 75 The Western Climate Initiative is the administrator of a greenhouse gas trading program linked between the State of California and the provinces of Ontario and Quebec. Nova Scotia joined the initiative on May 14, 2018, although it remains a separate cap-and-trade program from the other three.118 A protectionist policy led by Trump has led the United States to promote individual trade agreements, reject major multilateral trade agreements, and challenge decades of global free trade.
On June 19, 2019, the Senate of Mexico ratified the agreement (114 yes, 3 no, 3 abstentions). [88] Mexico`s ratification procedure will be completed when the President announces ratification in the Federal Register. On May 18, 2017, the Trump administration sent a message to Congress about its intention to begin talks with Canada and Mexico to renegotiate NAFTA.73 After the 90-day consultation period with Congress, ordered under the Trade Promotion Authority, negotiations began on August 16, 2017. Initially, much of the debate focused on the revision and modernisation of the nearly 25-year-old agreement. The three sides focused on integrating new or expanded language from the Trans-Pacific Partnership (TPP) negotiations on e-commerce, intellectual property rights, investment, labour, environment, sanitary and phytosanitary standards, state-owned enterprises, data flows and data relocation – data management requirements in the country. no target was met to conclude the talks by March 31, 2018; In addition, no goal has been reached to conclude the talks by the end of May 2018, which could allow for consideration at the current session of Congress. The imposition of tariffs on steel and aluminum from Canada and Mexico (see “Steel and Aluminum Taxes”) may have further dampened the dynamics of an agreement. However, many economists do not believe that trade balances are primarily the result of trade policy, reflecting instead public borrowing, private investment and saving decisions, and international capital flows. A new addition to the USMCA is the inclusion of Chapter 33, which covers macroeconomic policies and exchange rate issues.
This is considered important, as it could set a precedent for future trade agreements. [54] Chapter 33 sets out monetary and macroeconomic transparency requirements that, if violated, would create a remedy under Chapter 20. [54] The United States, Canada and Mexico currently meet all of these transparency requirements, in addition to the substantive political requirements that are consistent with the articles of the International Monetary Fund Convention. [55] • Benefit U.S. farmers, ranchers, and agricultural businesses by modernizing and strengthening food and agricultural trade in North America….
