Support for U.S. ratification of USMCA grows stronger

As discussions around ratifying the United States-Mexico-Canada Agreement (USMCA), the successor agreement to NAFTA, in the U.S. Congress, one party to the new trade deal is making moves. Mexico’s Senate last week ratified the trade agreement in a 114 to 4 vote, effectively completing work on the agreement in that country.

After leaders from the three North American countries signed onto the agreement last fall, the trade deal went to the respective countries’ legislative bodies for domestic ratification.

Mexico sends about 80 percent of its exports to the U.S., and with more produce coming through and an increasingly cohesive manufacturing industry growing between the country and the U.S., USMCA has always found favor in Mexico.

“We once again reiterate our determination, our conviction to maintain relations with Canada and the United States of friendship and cooperation in enhancing development,” Mexican President Andrés Manuel López Obrador said in a video statement. Obrador has been pulling for the ratification, poking on the potential for job creation, trade and foreign investment.

But while legislation passed by a wide margin in Mexico, debate over the agreement on Capitol Hill still looms, with House Democrats expressing hesitations over enforcement mechanisms for the pact’s labor and environmental rules.

Mexico earlier this year ranked as the U. S.’ top trade partner, with Census data showing that Mexico’s trade with the U.S. rose to just under $98 billion for the first two months of this year alone.

With this in mind, support for ratification on the U.S. side has grown louder.

Following the Mexican Senate vote, Gov. Doug Ducey and Sonora Governor Claudia Pavlovich released joint letters urging the passage of the USMCA on the American side. Both governors will be attending and overseeing this week’s Arizona-Mexico Commission Summit, where lawmakers and business personalities will come together to discuss the strengthening business relationship between the two countries.

“We have a once in a generation opportunity to really propel our relationship to the next level,” said Gov. Ducey and Gov. Pavlovich in the letter. “We are hopeful that both of our federal legislatures will recognize the importance of ratifying USMCA/TMEC so that all our citizens can begin to benefit from the improvements, compromises, and modernization to which all three countries have agreed. The time is now.”

Two-way trade, including trains, commercial trucks, pedestrians, and commuter vehicles, was up 7.7 percent in 2018 between Arizona and Mexico, and projections for this year aim higher. The total from the upward movement brought in a total of $16.6 billion, with nearly $28 billion worth of goods coming in through our ports of entry.

In another letter penned by multiple governors, 28 states made the case for the agreement’s importance, especially before Congress takes its summer break, and before things get heated up for the next general election cycle. Governors, including Brad Little of Idaho, Bill Lee of Tennessee, and Mark Gordon of Wyoming–states that don’t directly share a border with Mexico or Canada–all signed on.

“As chief executives of our states,” the letter reads, “we urge Congress to pass USMCA quickly so American workers can begin reaping the benefits of improved trade with our North American neighbors.”

And that’s the point that economists and pro-business advocates, like Luis Ramírez, are making. Time is of the essence to get things done and keep trade flowing.

“It’s business that is waiting for this to happen. Businesses want to know what kind of treatment they’re going to get with this trade deal. We want a stable and predictable environment,” Ramírez said.

According to Ramírez, Mexico’s Senate passage of the deal was done in part to urge Canada and the U.S. to get things going.

“The wide margin vote in the Mexican Senate says something. It was almost a unanimous vote, and that includes almost every party in Mexico. It’s impressive that it got done, but also that it got done with broad support. We hope it carries over into the U.S. and Canada,” he said.

Ratification is also getting a push on the local level, as the Yuma County Board of Supervisors just approved a resolution in support of USMCA. Published on June 17, the resolution highlights everything from job creation and dependency to the benefits of trade between the nations and how the agreement would only boost those components.

“Trade, tourism, and economic development opportunities between Yuma County and the Mexican states of Sonora and Baja California are becoming increasingly important components of our regional economy,” writes Marco A. Reyes, Chairman of the Board of Supervisors for Yuma County.

The county’s San Luis Port of Entry trade totaled $1.29 billion for all of 2018 and saw an 18.68-pecent rise in trade with the rest of the world. The port of entry has been undergoing modernization updates in recent months, speeding up processing times, installing high-tech cameras and sensors to crack down on illegal entries, and to allow more trucks to enter more efficiently, which boosts imports and exports.

Nick Esquer

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