The United States-Mexico-Canada Agreement (USMCA) becomes effective on July 1 after more than a year of negotiation between the countries. The deal is expected to provide a $2 billion annual increase in American agricultural exports and also provide an overall increase of $65 billion in gross domestic product. During an online roundtable hosted by Farmers for Free Trade, lawmakers celebrated the development of the trade agreement and cited the deal as a prime example of what can be accomplished through cooperation.
“Clearly with the introduction and the action today of the agreement between the United States, Mexico, and Canada, we begin a new phase of that trade,” said Congressman Jim Costa. “This is an important step that we need to build on and I thank the leadership that Chairman Peterson provided along with our colleagues in the Senate, the bipartisan support, because quite frankly trade agreements, like other difficult pieces of legislation, only happen when you have bipartisan efforts that come together.”
Canada is ranked as America’s second-largest trading partner, with Mexico being the third largest. The USMCA was originally agreed to by all three countries in December 2019. Many aspects of the USMCA should provide better access for a variety of American agricultural products, creating more opportunities for farmers and ranchers. “Canada and Mexico combined amount to more trade than our other eight trading partners combined,” Costa noted. “In California, the number one agricultural state in the nation, 44 percent of our agriculture is dependent upon trade.”
There have been some concerns raised in relation to USMCA in the agreements’ ability to address certain trade practices in both Canada and Mexico. U.S. Trade Representative Robert Lighthizer has remained steadfast in the belief that the trade deal will deliver on what has been agreed to. Congressman Collin Peterson, Chairman of the House Agriculture Committee heralded USMCA entering into force as good news but expressed the need to ensure the agreement is adhered to.
“We’re finally seeing implementation of this agreement, so that’s a very positive thing at a time when we need positive signs and positive action in agriculture. I would just say that we need to be vigilant because there are some troubling signs out there of people using COVID as a reason to put up trade barriers,” said Peterson. “We need to be vigilant and we need to make sure that the agreement is enforced, and it goes into place the way that it was intended.”
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