Six months ago one of Donald Trump’s signature campaign promises – the renegotiation of the “terrible, awful” North American Free Trade Agreement (NAFTA) – looked set to become reality after U.S., Mexican and Canadian trade negotiators reached agreement on a new pact, the creatively named U.S.-Mexico-Canada Agreement (USMCA). But things are looking very different now, as domestic electoral politics may derail or significantly delay ratification.
- The Democratic win in the House of Representatives in November was already a big stumbling block for USMCA ratification. Now the upcoming U.S. presidential election in 2020 will once again make USMCA, like every other entity in the universe, into a political football, with Democrats and their union constituents strongly opposing key labor provisions in the deal.
- Not to be outdone, Canada’s federal election in October of this year will also make USMCA a hot button issue there. One particularly prickly issue is its renegotiation of agricultural protections for Canadian dairy farmers, who now face a flood of cheaper milk from rude, pushy American cows.
- Mexico and Canada also both take exception to metal tariffs, while Trump, in usual capricious fashion, has linked trade relations with a number of other incendiary arenas, for example demanding stronger Mexican action on immigration, backed up with a threat of auto tariffs.
- It also probably doesn’t help that many American legislators don’t know what large portions of the agreement mean, for example regarding the enforceability of labor reforms in Mexico and environmental conditions in all three countries.
In short, don’t hold your breath. A vague consensus opinion seems to be that ratification may be possible in 2021. Or never.
