Washington Business Fall 2019 | Washington Business | Page 30

federal focus
expanding trade
Over the last 25 years, U.S. food and agricultural exports to Canada and Mexico have more than quadrupled under
NAFTA – growing from $9 billion in 1993 to nearly $40 billion in 2018. NAFTA has significantly helped create a
reliable, high-quality supply of food products for U.S. consumers, while supporting more than 900,000 American
jobs in food and agriculture and related sectors of the economy.
In Washington state, the most recent data show that in 2017, $760.7 million in agricultural products and $685.5
million in processed foods were exported from Washington state to Mexico and Canada. USMCA builds on the
success of the NAFTA agreement, and will ultimately lead to freer markets and fairer trade. This modernized trade
agreement makes improvements to further enhance U.S. food and agricultural exports to Mexico and Canada and
would deliver an additional $2.2 billion in U.S. economic activity.
pathway to ratification
The path to ratifying the new trade agreement is varied and will likely take the longest in the United States, the
country that initiated the new agreement.
Mexico became the first member country to ratify the agreement in June when the Mexican Senate voted in
favor of the Tratado entre México, Estados Unidos y Canadá (T-MEC), as it is referred to in Mexico.
Canada formally started its ratification process in
May but it did not pass before the federal elections in
October.
In the United States, the current United States
Administration formally sent the draft USMCA
Statement of Administrative Action (“SAA”) to
Congress at the end of May, which started the clock
ticking for submission of the implementing bill to
Congress, which in turn starts the clock ticking for
the House and Senate vote on the bill. The USMCA
ratification must happen this year in the U.S. or wait
until after 2020 with an impending election season,
which would move implementation into early 2021.
sense of urgency
Until all three countries ratify the new agreement, the
original NAFTA continues to govern North American
trade. If Congress were to amend their ratification
legislation, treaty negotiators among all three
countries would then need to determine whether
Mexico and Canada would be willing to accept the
amended legislation and amend any ratification
legislation they might have already passed.
So far, Mexico and Canada have been clear
they are not going to renegotiate the underlying
agreement. And that means, as the clock continues
to tick, the road continues to get steeper for
USMCA in the United States.
30 association of washington business