CUSMA: Let’s Get It Done

It’s time to restore predictability to trade in North America. That’s why it is encouraging to see the House Trade Committee set to wrap up its study of the implementing legislation this week and the Senate already preparing to review CUSMA

by Dan Darling – Canadian Agri-Food Trade Alliance (CAFTA)

After three years of negotiating and waiting, Canadian farmers, agri-food exporters need certainty and stability.

Let’s be honest, there is no reopening the deal or amending it at this stage. With CUSMA now ratified in both Mexico and the United States, Canada needs to follow suit and fast. Delaying ratification at this stage may only have negative impact on relations with our trading partners, who let’s not forget, reserve the rights to move ahead on a bilateral deal if Canada takes too long to ratify.

With over half of our agri-food products in Canada exported, farmers, processors and food manufacturers are especially keen to see free trade preserved in North America, our largest and most significant market.

“With CUSMA now ratified in both Mexico and the United States, Canada needs to follow suit and fast. Delaying ratification at this stage may only have negative impact on relations with our trading partners, who let’s not forget, reserve the rights to move ahead on a bilateral deal if Canada takes too long to ratify”

 

And that is precisely what CUSMA does. The benefits for Canada’s agri-food sector are numerous.

Perhaps most importantly, the agreement contains no new tariff or trade-restricting measures. Maintaining predicable, duty-free access to the North American market is a major win for agri-food exporters. Equally important is the preservation of dispute resolution provisions that are vital to ensuring fair and transparent processes are in place for when disagreements arise, particularly given the loss of the global trading system’s top referee as the WTO’s Appellate Body ceased to function for the first time in history in December.

The new agreement also includes meaningful progress on regulatory alignment and cooperation in biotechnology and sanitary and phytosanitary among other areas, which will help ensure regulations are transparent, based on science and that trade in North America flows freely, fairly and abundantly. Last but not least, there are even market access improvements for Canadian agri-food exporters including increased quotas for refined sugar and sugar containing products as well as gains for some processed oilseeds products like margarine – all welcome news for food manufacturers.

Simply put, CUSMA represents a meaningful upgrade to NAFTA for our members by keeping the majority of our trade tariff free, establishing processes that help remove remaining technical barriers to trade, and maintaining vital provisions to deal with disputes. In short, it secures rules-based, stable and predictable trade to two of the largest markets in the world and brings free trade in North America resolutely into the 21st century.

We must now finish the job by ratifying and bringing CUSMA into force so that our members can tap into its benefits as quickly as possible.

CUSMA should not be a partisan issue. While we respect the vital role Parliament plays in reviewing legislation, we cannot let certainty and stability in our most important export markets get caught in political cross-fires. Our trading partners are watching and we have an opportunity to send a strong message on the importance of rules-based trade and our willingness to compete with the world as an integrated North American market.

Canada moved fast and ratified the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in a record five weeks’ time. Today again, we urge nonpartisan collaboration to enable swift ratification and implementation of the new NAFTA.

The Mexicans have ratified, even the Americans have ratified. Despite being deeply divided on virtually every other topic, the U.S. Congress found bipartisan agreement on the successor agreement to NAFTA in an election year. We must put politics aside and follow suit. It’s time to get back to business.

Dan Darling is president of Canadian Agri-Food Trade Alliance (CAFTA), the voice of Canadian agri-food exporters, representing the 90 per cent of farmers who depend on trade and the ranchers, producers, processors and agri-food exporters who want to grow the economy through better access to international markets.This article is adapted from CAFTA’s testimony Tuesday before the House of Commons Committee on International Trade