July 29, 2019

Democrats Push For USMCA Enforcement

 |  By: Mike Opperman

A trade working group led by Ways and Means Chairman Richard Neal (D-Mass.) visited Mexico in July to visit with Mexican workers and officials about enforcement of labor and environmental working provisions in the pending United States-Mexico-Canada Agreement (USMCA). Last week they presented their findings to U.S. Trade Representative Robert Lighthizer, according to Jim Wiesemeyer, Pro Farmer’s Washington analyst. 

The working group met with Lighthizer on several occasions to discuss concerns about USMCA, and enforcement is one of the key issues. The working group questions whether Mexico will have the money for enforcement, according to Wiesemeyer. 

“There’s a lot of agreement that enforceability is a big component of getting this right,” says working group member Jimmy Gomez (D-Calif.). “There’s definitely agreement that enforceability, monitoring are big issues.” 

The working group floated the idea of enforcing Mexican labor reforms by tying a firm’s benefits, such as lower tariffs, under USMCA to its compliance with new Mexican labor requirements, according to Wiesemeyer. 

The USMCA agreement remains held up in the House of Representatives, and congressional action will depend on whether the Trump administration can augment the agreement to achieve “substantial and real” improvements. 

“It is time for the administration to present its proposals and to show its commitment to passing the new NAFTA and delivering on its own promises,” the working group wrote. 

USMCA is important for dairy interests as Mexico and Canada continue to perform as the number one and three trading partners for U.S. dairy products, respectively. While the agreement will expand marketing opportunities in Mexico, it will help to revise the Class 7 pricing program in Canada that has limited access to U.S. products while undercutting global powder prices.