Enforcing the US-Mexico-Canda agreement

Since entering into force on July 1, 2020, the United States-Mexico-Canada Agreement has provided a powerful framework to fight for opportunity on behalf of American workers, producers and industry and has strengthened ties with our nation’s top two trade partners. Spearheaded by the Trump administration as a much-needed modernization of the North America Free Trade Agreement, USMCA won 474 “yea” votes across both Chambers as it passed through Congress, the greatest level of bipartisan support for a trade agreement since 2001.

In addition to implementing innovative protections to address 21st Century issues, such as digital trade and American intellectual property, USMCA paved the way to a more level playing field for American businesses, farmers and ranchers through mechanisms to settle trade disputes between our nations. However, these dispute resolution tools are useless unless the Biden administration deploys them. President Biden must enforce all aspects of the agreement—beyond just his priorities of labor and the environment.

To highlight and discuss the need for Mexico and Canada to uphold their ends of the bargain, this week I led a Ways and Means Trade Subcommittee roundtable entitled “Enforce USMCA to Make Trade Work for All Americans.” I welcomed Mark McHargue, president of Nebraska Farm Bureau, and Stephen Comstock, vice president of corporate policy at the American Petroleum Institute, to the meeting to discuss the impact of several ag and energy-related aspects of USMCA which are not yet properly enforced.

For example, in USMCA Canada agreed to eliminate a program which allows low-priced Canadian dairy ingredients to undersell our American dairy products in Canada and third-country markets. If adhered to, this change would level the playing field for American dairy and provide new export opportunities for U.S. dairy farmers. Soon after USMCA entered into force, the Trump administration determined Canada was not honoring this commitment and requested enforcement consultations.

Despite a USMCA dispute settlement panel ruling in favor of the United States in January 2022, full compliance by Canada remains long overdue. I am grateful this week our United States trade representative, Ambassador Katherine Tai, announced the U.S. is requesting dispute settlement consultations with Canada under USMCA for the second time—a bright spot in the Biden administration’s disappointing lack of activity on trade matters.

As our country’s largest export market for corn products, Mexico has a long history as a critical trading partner for our producers. Unfortunately, I have serious concerns Mexico is not honoring its USMCA commitments with respect to its handling of genetically modified corn imports. Additionally, the Biden administration must stand up for American companies against Mexico's energy sector "reform agenda," which unfairly promotes Mexico's state-owned petroleum and utility companies over private U.S. investment.

In the midst of our supply chain and inflation crises, enforcement of USMCA is urgently needed to boost the economy of the North American corridor.

Rather than relinquishing the wins negotiated in USMCA at the expense of American producers and consumers, USTR must evaluate potential USMCA claims at every opportunity. Failing to utilize USMCA’s established mechanisms to find solutions to our disagreements is irresponsible.