USMCA and ND

I really really want to read the USMCA trade deal. I realize I am one of the few that does, but the fact is that North Dakota is a state that looked to lose a great deal from the trade war since this state had the highest per capita trade surplus with China, Mexico, and Canada. But I cannot find a full version of the agreement in a single PDF, only each individual section. This makes text searching for my key terms almost impossible. But then I sit back and realize that the document is not yet available in Spanish and I say, maybe my convenience is not the biggest deal. There is a whole country that is part of the deal that cannot get the document in their native language right now, just in English, from the US Trade Representative’s website. I mean Article 34 Section 8 says, “The English, French, and Spanish texts of this Agreement are equally authentic.” It says nothing about their existence I suppose.

So let us start with the basics. This was never a deal that even considered North Dakota. What do I mean? This was about aspects of the US economy like autos and manufacturing that were not able to compete as well globally as in the past. Was that due to trade deals? Post hoc ergo propter hoc. I am sure they did little to help certain industries but there are so many other factors worthy of consideration here that I am going to just move on. 

North Dakota economic output has little concentration in the manufacturing and other sectors where the meat of the agreement occurred. Even our agricultural producers were not really shut out of the old NAFTA and gained little from the new deal. 

The biggest issue is still China and this document gives some indication that the hard line with Mexico and Canada was less about disagreements with them and more about disagreements with China. Witness Article 32 Section 10, the Non-Market Country FTA. I wonder who that is? Venezuela perhaps? 

If any member of the USMCA decides to enter into a FTA with the a non-market country the others can cut and run from the USMCA. As written in paragraph 10.

Entry by any Party into a free trade agreement with a non-market country, shall allow the other Parties to terminate this Agreement on six-month notice and replace this Agreement with an agreement as between them (bilateral agreement).

https://ustr.gov/sites/default/files/files/agreements/FTA/USMCA/32%20Exceptions%20and%20General%20Provisions.pdf

So the USMCA is with us for 16 years which is great for certainty of cross border investments and other similar aspects. What we have though is a document that potentially binds the hands of countries in terms of how they deal with China. Clearly the issue here can be language versus actual execution but it does not give North Dakota companies, and ag producers, and greater certainty about their dealings with China, or what the access to Chinese markets will look like. 

The text of the USMCA at the time of writing can be found here

One Comment, RSS

  1. Sarah October 4, 2018 @ 5:45 am

    I’ve not read this new trade deal but I wonder how substantively different it is from the old one. This is if course other than the afore mentioned “escape/control” clause.

    I feel like that clause is there to limit the power of other nations to create additional agreements. For example it appears that if Latin America wanted to create a free trade block including Mexico then it appears that they could be excluded from this deal.

    While I understand the “economic harm” that has come from the relatively free trade with China has created does the government really feel that this will create incentives for companies to come back? It seems to me that in many cases there has been a lot of noise over some dubious economic decision making. Also to your point there seems to be little thought about the national impact of new policies focusing more on industry specific policies over general policies that could impact more people.

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