USMCA priorities for the United States in 2022

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Editor's note:

Below is a viewpoint from the USMCA Forward 2022 report, which examines key priorities to build a more competitive, inclusive, and sustainable North American economy.

USMCA Forward 2022The USMCA is the cornerstone of North America’s economic future and a reflection of the ongoing evolution of trade policy in response to contemporary challenges. This agreement, revised with landmark protections for workers and the environment coupled with new and enhanced enforcement tools, came after an intensive renegotiation process with Canada and Mexico involving a broad range of stakeholders on both sides.

Sustained bipartisan engagement here in the United States led to a final, renegotiated USMCA that secured robust levels of support in Congress not seen since the North American Free Trade Agreement (NAFTA). Dozens of groups, including the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), the U.S. Chamber of Commerce, the NETWORK Lobby for Catholic Social Justice, and state and local leaders across the country ultimately endorsed the new agreement.

The overwhelming support for the USMCA creates a strong foundation for the Agreement’s durability. Full implementation and enforcement of the USMCA are top priorities for the Biden-Harris Administration, and a key component of a worker-centric trade policy.

The Agreement reflects the United States’ commitment to raising wages and empowering workers, and it recognizes that workers and producers are central to creating more productive and competitive North American economies.

The USMCA will help North America meet the challenges of the 21st century and facilitate a robust and just pandemic recovery.

The labor and environmental obligations, the strongest of any trade agreement, are fully enforceable through new tools and mechanisms that we actively employed in 2021. These include the obligation to identify and ban imports of goods produced with forced labor. This demonstrates North America’s leadership to eliminate this practice from our supply chains as a moral imperative and a term of fair economic competition.

The groundbreaking Rapid Response Mechanism gives the United States the opportunity to proactively support Mexico’s domestic labor justice reform efforts and empower workers in Mexico and the United States at the same time. In May 2021, the United States self-initiated a labor enforcement action under a trade agreement for the first time in history. We resolved another matter that led to severance and back pay for Mexican workers and a commitment to neutrality in future union elections.

Our actions are aimed at driving a race to the top in trade and raising regional labor standards. But our commitment to workers and producers does not stop with the Rapid Response Mechanism.

Earlier this year, the United States prevailed in the first dispute settlement panel under the Agreement that reviewed whether Canada’s allocation of its dairy tariff-rate quotas undermined the ability of American exporters to sell a wide range of dairy products to Canadian consumers. Delivering on this historic win will ensure that American dairy farmers get the full benefit of the USMCA to market and sell their products in Canada – a promise critical to securing the support of agricultural and rural stakeholders for the USMCA.

Importantly, the USMCA will help North America meet the challenges of the 21st century and facilitate a robust and just pandemic recovery. The critical changes to the intellectual property provisions will help promote access to affordable medicine for all. The Agreement’s conservation commitments will also contribute to North America’s sustainability and resilience efforts.

The Agreement also confronts the non-market practices of countries outside the region that force our workers and businesses to compete on an uneven playing field. All three countries agreed to important provisions regarding state-owned enterprises and currency manipulation. We also committed to combatting efforts to undermine existing antidumping, countervailing duty, and safeguards measures.

In approving the USMCA, Congress delivered on a vision for ongoing implementation and monitoring of the Agreement’s terms. The $180 million authorized over four years will support Mexico’s labor reforms through technical assistance and enhancing United States’ efforts to monitor and enforce the agreement’s environmental obligations. This funding has already led to stronger intelligence sharing and increased capacity to combat illegal take and trade in flora and fauna. It also supported new collaboration with Mexico and Canada on sustainable forest management, sustainable fisheries management, and conservation of marine species.

There is a lot to celebrate as we approach the USMCA’s second anniversary, but the work of implementation is just beginning. We must use the new tools in the Agreement to effectively resolve our trade disputes and uphold the commitments made to each other. In 2022, we will work together to support regional workforce development and small and medium-sized enterprises (SMEs) while identifying ways to increase the resiliency of our supply chains, combat forced labor, protect the environment, and address the harm from state-owned enterprises.

The Biden-Harris Administration is committed to using the USMCA as a model for how trade agreements can put workers and their interests first. In the coming years, it will be critical for the United States, Mexico, and Canada to continue our close cooperation to ensure the USMCA remains a living agreement that delivers inclusive economic growth and broadens our collective prosperity.