The USMCA must strengthen cooperation between the public and private sectors

Extending the United States-Mexico-Canada Agreement (USMCA) is critical to the economic growth, competitiveness, and security of North America. The lives and livelihoods of American, Mexican, and Canadian workers, farmers, entrepreneurs, and their families depend on the certain and continued operation of the USMCA—an agreement which has benefited all three countries.

The USMCA has shown itself to be an improvement over the North American Free Trade Agreement (NAFTA) it replaced. Despite generational geopolitical shifts and a global pandemic, continental trade and investment have increased steadily as the USMCA has allowed and encouraged businesses to make historic regional investments to create a more powerful and productive economic bloc.¹

When negotiating the USMCA, the leaders of all three countries chose to include a review process to ensure it would continue to serve the interests of their citizens. While the evidence clearly demonstrates it does, this deal and our North American economy can be even better. We must seize the opportunity to strengthen the resilience of our integrated economies, so they generate greater prosperity for decades to come.

To do so, the review should adhere to a pair of guiding principles. First, a renewed USMCA must promote increased commercial dealings and cross-border investment between all three countries. Second, as trade agreements are negotiated by governments but for workers and businesses, a renewed USMCA must guarantee far greater collaboration between government and business.

With respect to this second principle, there is an easy solution: The membership of certain committees established by the provisions of the USMCA, including both the Committee on Good Regulatory Practices as well as the North American Competitiveness Committee, should be expanded to include private sector representatives from the U.S., Canada, and Mexico.

As the review process itself has demonstrated, consulting directly with those who rely on the USMCA for their commercial dealings and investment decisions is essential to ensuring the agreement achieves both its full potential as well as the economic policy objectives of our three countries. This level of cooperation should be continuous, not limited to once every six years.

Moreover, the mandates of the USMCA committees should be streamlined to ensure they are narrowly focused on shared priorities such as eliminating regulatory burdens and increasing our economic competitiveness. Too often, their roles and responsibilities duplicate the work of other committees, or they are directed to consider extraneous factors unrelated to their core purpose.

Deeper cooperation between the public and private sectors of all three USMCA countries through the more effective use of streamlined, specific purpose committees would give us greater agility to adapt to changing global market realities and the emergence of new technologies. It would provide real-time input to inform how we can best harmonize and align economic policy decisions.

If this proposed model was accepted, a renewed USMCA should create two new committees. The first of these would be an Energy Dominance Committee with the mandate to develop a common vision for how to harness and leverage our continental resources. This should include shared approaches to approve projects to enhance energy and critical mineral supply chains.

This new committee would respond to the call from business leaders in all three countries to create a North American Energy Alliance—a joint effort to seize opportunities across our continent and expand our reach around the world to provide allies and other like-minded trading partners with access to secure supplies of reliable energy and strategically important critical minerals.

A second new USMCA committee should focus on North American economic security. Its mandate would be to collectively assess threats and coordinate how best to address them. It would help develop a common vision of North American economic security and consider collective measures to protect our continent from economic coercion, unfair practices, and weaponized trade.

The public and private sectors of all three countries view North American economic security as an urgent priority. Yet, within the existing text and context of the USMCA, security interests are framed more as a rationale for a country to exempt itself from its obligations rather than a reason for greater alignment and collective action. This puts North American economic security at risk.

A USMCA committee on North American Economic Security could also provide a mechanism for business and government to harmonize and align policies and practices to better protect cross-border critical economic infrastructure and other integrated networks, many of which are operated, owned, or controlled by the private sector—strengthening “Fortress North America’s” defenses.

The USMCA is more than a free trade deal; it is a comprehensive economic agreement through which our three countries have resolved to “establish a clear, transparent, and predictable legal and commercial framework for business planning.”² Ensuring greater collaboration with business leaders will ensure continued economic growth in North America.