Dec 10, 2018 - 9:00am

Next Steps for North American Trade


President and CEO, U.S. Chamber of Commerce

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Enrique Pena Nieto, Mexico's president, President Donald Trump, and Canada's Prime Minister Justin Trudeau after signing the United States-Mexico-Canada Agreement.
Enrique Pena Nieto, Mexico's president, President Donald Trump, and Canada's Prime Minister Justin Trudeau after signing the United States-Mexico-Canada Agreement.

After more than a year of negotiations, with plenty of ups and downs along the way, President Donald Trump, Canadian Prime Minister Justin Trudeau, and now former Mexican President Enrique Peña Nieto signed the U.S.-Mexico-Canada Agreement (USMCA) on November 30. This agreement – a follow-on to NAFTA – will modernize the trade partnership that has formed the basis of North American relations for a quarter of a century. 

After carefully assessing the new deal and its impact on our members, the U.S. Chamber of Commerce has thrown its support behind the USMCA, which is critical to maintaining strong economic growth in the U.S. We will work with the administration and other stakeholders to address a handful of outstanding issues and secure approval of the USMCA in Congress.

A critical first step is lifting the tariffs on steel and aluminum imports from Canada and Mexico that were supposed to end once the USMCA was agreed to. These tariffs – imposed on our partners as a negotiating tactic – have invited $15 billion in counter-tariffs on U.S. agricultural and manufactured goods. Every week that the tariffs remain in place, $500 million in U.S. imports and exports are affected, inflicting significant harm on American workers, farmers, and ranchers. They must be eliminated without delay. 

We must also build support in Congress on the merits of the deal. Shortly after signing the USMCA, President Trump announced that he would be “terminating NAFTA quickly” in order to present the incoming Congress with a choice between the new agreement and no agreement. We disagree with this strategy. U.S. Trade Representative Robert Lighthizer has insisted that the USMCA was negotiated in such a way to attract bipartisan support. So essentially issuing this threat against a co-equal branch of government is neither necessary nor productive and could actually cost votes. 

This is a risky gambit when you consider that withdrawal from NAFTA without a successor agreement could jeopardize 1.8 million American jobs. We are urging the administration to drop this threat. The USMCA is a good agreement, and the business community will help make that case to Congress. 

It has been a long and, at times, a rocky path forward for North American trade relations. We are in a better place today than we were several months ago – when the future of the trilateral partnership seemed in question – but we still have a way to go. The U.S. Chamber will stay the course and continue to work toward a modern and mutually beneficial economic relationship with our two closest friends and neighbors.

About the Author

About the Author

Thomas J. Donohue
President and CEO, U.S. Chamber of Commerce

Thomas J. Donohue is president and CEO of the U.S. Chamber of Commerce.