Trump administration officials continued to make the case for congressional approval of the U.S.-Mexico-Canada Agreement (USMCA) during a House subcommittee hearing Tuesday.
The pact provides greater market access for U.S. dairy exports to Canada, eliminates discriminatory grading of wheat, improves poultry access, modernizes NAFTA’s sanitary/phytosanitary provisions, adds new biotechnology language, includes new disciplines for geographical indications and includes a commitment by Canada to end discriminatory treatment of retail sales of U.S. wine and spirits, Agriculture Department Under Secretary for Trade and Foreign Agriculture Ted McKinney said.
During the hearing of the House Agriculture Livestock and Foreign Agriculture Subcommittee, Gregg Doud, chief agricultural negotiator at the Office of the U.S. Trade Representative, said USMCA passage is an absolute necessity.
“The urgency to pass USMCA cannot be overstated for U.S. agriculture, due to the size of the Canadian and Mexican markets for U.S. ag products,” Doud said.
Trump tweeted on May 31 that he would impose tariffs on Mexico starting at 5% on June 10 and gradually increase them until Mexico stopped the flow of illegal migration into the U.S.
The U.S. and Mexico on Friday reached an agreement to indefinitely suspend the threatened tariffs, as Mexico committed to undertake stronger measures to stop the flow of illegal migration to the U.S.
Costa said the removal of steel and aluminum tariffs on Canada and Mexico was a step forward in advancing the USMCA approval process, but Trump’s more recent tariff threat on Mexico was a step backward.
“I hope there [will] be no more policy surprises as we attempt to work on a bipartisan basis to move this trade agreement forward,” he said.
Rouzer noted that the International Trade Commission’s analysis of the likely U.S. economic impacts of USMCA found that the agreement would increase U.S. agricultural exports by $2.2 billion annually.
“With the most recent agriculture trade surplus having fallen to just $10.9 billion, an increase in exports provided by USMCA is significant to our producers and to the rural communities in which they live,” Rouzer said. “It is … absolutely vital that we approve the USMCA quickly so that the fine folks at USDA and USTR can open up even more market access for U.S. food and fiber in other places as well.”
Over 900 food and agriculture groups in a letter to bipartisan House and Senate leadership Tuesday urged USMCA’s swift ratification.
NAFTA increased U.S. food and agricultural exports to Canada and Mexico from $9 billion in 1993 to almost $40 billion in 2018, and USMCA would build on the success of the existing trade deal, the groups wrote.
He said certain threats by the Trump administration, including to terminate NAFTA, don’t help USMCA’s chances of approval, but added that there are Democrats who want to get to a “yes” vote on USMCA, should their concerns on labor, enforcement, the environment and pharmaceutical provisions be addressed.
“These are issues we’re trying to work on, and we hope to work on, because there are people on both sides of the aisle that do want to get to ‘yes,’ so please understand that,” Panetta told Doud and McKinney. “Obviously, we’ve got a ways to go.”
Lighthizer will testify next Tuesday and Wednesday before the Senate Finance and House Ways and Means committees, respectively, in public hearings that will touch on USMCA.