Washington and New York. The two presidential candidates, Kamala Harris and Donald Trump, have already indicated that they will demand significant changes to the United States, Mexico and Canada Agreement (USMCA), from restrictions on car imports to limiting purchases of products manufactured by Chinese companies in Mexico. , among others, but experts indicate that its southern trading partner will also have lever
to demand changes, including, for example, a ban on corn treated with glyphosate, recognition of food sovereignty and support for the manufacture of strategic industries
in sectors such as semiconductors.
If I were advising President Sheinbaum, I would tell her that one of her demands should be to give Mexico room to maneuver on agriculture and try to recover space for domestic food security and rural policies that NAFTA destroyed.
I comment to The Day a US expert in bilateral economic relations, who requested anonymity. He added that on another issue that is not formally part of the treaty, the United States could be pressured to offer side agreements
that offer more work permits for Mexicans in the United States and a path to regularization for undocumented immigrants.
The three T-MEC countries face a deadline of July 1, 2026 to express whether they wish to continue under the agreement as is or negotiate changes. However, in practice, in the United States the government has to open a public consultation process on modifications in October 2025 and by January 2026 it has to send Congress the list of fixes sought in the agreement. A US official told the CBC (Canadian public radio and TV) that internal discussions
on changes to the agreement had started since December 2023.
For their part, representatives of the business and agricultural sectors are already lobbying the Executive and Congress on several of these issues. Centrist think tanks such as the Brookings Institution, the Baker Institute in Texas and the Wilson Center are also preparing documents and organizing forums to evaluate possible corrections to the USMCA.
The US presidential election will have an impact on these discussions. If Republican Donald Trump wins the election, analysts Joshua Meltzer and Steve Verheul wrote in a Brookings publication, it is likely that will threaten to annul the agreement if US concerns are not met
although in the end I could use that tactic only at the beginning. Within the agreement there is a mechanism that allows any of the three partner countries to withdraw from the T-MEC with only six months’ notice.
There is no doubt that Trump will want change. In September it threatened to impose a 200 percent tariff on agricultural equipment manufactured by John Deere if the company dares to move part of its production to Mexico. He also threatened more recently to impose 100 percent tariffs on cars produced in Mexico. These measures, if carried out, require adjustments to the agreement.
For her part, Democratic candidate Kamala Harris has expressed doubts about parts of the current agreement. As one of only 10 senators to vote against the USMCA, I knew it did not have sufficient protections for our country and its workers.
Harris tweeted in late September, before promising to use the USMCA review process to make changes to the agreement. In that context, she added that As president, I will return auto jobs to this country and create an economy of opportunity that strengthens manufacturing, unions, and builds prosperity and security for America’s future.
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What changes could these candidates propose? Meltzer and Verheul speculate they could include labor, energy and agrarian issues. Canada would add dairy and a digital tax, among others.
The US government has brought cases under the T-MEC against the reforms of the government of Andrés Manuel López Obrador that give priority to energy generated by the Federal Electricity Commission (CFE) and Petróleos Mexicanos (Pemex) over private companies.
Another priority issue, commented an expert in international trade affairs, who requested anonymity, is related to automotive manufacturing. A USMCA panel ruled more than a year ago that under the current agreement, the United States cannot force Mexico to use more local content in cars that are assembled for export to the United States. Whoever wins the presidential election, one of the demands will be to modify the rules of origin in the automotive sector
.
He added that the United States wants the agreement to address who they are the owners benefited
of companies in Mexico for Prevent Chinese car manufacturers from establishing themselves in Mexico to be able to enter the United States without taxes and evade the tariffs imposed by Joe Biden’s government.
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Washington could also try to offer more incentives for North American production of products considered strategic
such as semiconductors, medicines and medical equipment, chemicals for certain medicines, advanced construction materials and telecommunications equipment.
Another way it could put pressure on Mexico is by expanding the USMCA labor measures to include greater intervention in labor disputes or also new environmental measures, which would be less likely if Trump wins.
However, the trade expert consulted by The Day He believes that the US desire for certain changes offers Mexico opportunities to promote others. For example, he noted that as part of supply chain negotiations, Mexico could insist on specific incentives from the United States for investments in the manufacturing of some products that could be kept discrete in the agreement or in parallel agreements similar to those it had. NAFTA.
The presumption is that Mexico and Canada prefer to renew the T-MEC without significant changes.
#demand #significant #TMEC
– 2024-10-08 06:19:49
