Canadian Dairy Farmers Aren't Happy With U.S. Trade Deal. Here's Why

02 Octobre, 2018, 14:41 | Auteur: Anatole Charbonneau
  • NAFTA 2.0 Trump delivers on another big promise

Wiens said the United States-Mexico-Canada (USMCA) agreement further opens up Canada's dairy industry to USA farmers.

But he noted that the agreement would need to be ratified by Congress, a step that could be affected by the outcome of the fall elections as Democrats seek to regain majorities in the House and Senate.

Prime Minister Justin Trudeau said the new agreement protects Canada's supply management systems. Describing the pact as a great deal for the three countries, Trump said it puts them in a position that they have never been in before. "And of course the stakes are considerably higher when dealing with China - the Chinese have leverage over the United States that Canada simply doesn't have".

Canada, the US' second largest trade partner, was excluded from a revamped NAFTA deal separately negotiated between Mexico and the USA in August after nearly a year of negotiations.

Kind of. The major USA stock indexes showed gains this morning, with the Dow rising more than 250 points (a gain of almost 1 percent.) But Julia Coronado, an economist and the founder of the company MacroPolicy Perspectives, told us that while this market rally is probably a reaction to the agreement, the pact itself is rather "unimpressive". "If China is the real target, then the USA would need to accelerate NAFTA discussions immediately and form a peace treaty with the [European Union] so that it could focus on China". The new agreement, he said, will support many hundreds of thousands of American jobs.

Trump has regularly blasted NAFTA as disastrous for the US economy.

Canadian dairy farmers surrendered about 1.5 per cent of domestic market access through the Comprehensive Economic Trade Agreement between Canada and the European Union, 3.25 per cent when the 12-nation Trans-Pacific Partnership was finalized and now about 3.6 per cent in the USMCA.

Washington and Ottawa reached an agreement on Sunday (local time) after weeks of tense bilateral talks to update the 1994 North American Free Trade Agreement.

Donald Trump has repeatedly threatened to rip up NAFTA outright or break it up into little pieces.

He says expanding American producers' access to the Canadian market won't fix what he sees as the underlying problem hurting USA producers: oversupply.

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In a big victory for Canada, NAFTA's Chapter 19 dispute resolution system, which involves anti-dumping and countervailing decisions, will remain intact.

The agreement will consolidate the North American region "as one of the most competitive in the world", according to the Mexican president on Twitter. "As the premier said in Question Period we will stand up for our farmers and hold the federal government accountable to compensate the agricultural sector".

The new pact will require regional content of 75 percent for automobiles, and also that 40 to 45 percent of vehicles coming to the produced in plants paying at least $16 per hour. But chamber president Perrin Beatty said the details of the text needed a closer look before a final verdict could be rendered. But Dan Ujczo, an worldwide trade lawyer with the US firm Dickinson Wright, said it would only apply to a very small percentage of vehicles that don't comply with the origin rules.

The agreement, moreover, does not address the steel or aluminum tariffs that the United States placed on its North American neighbors earlier this year.

Trump's advisers view the trade pact as a political victor in Midwest battleground states critical to the president's 2016 victory and home to tens of thousands of auto workers and manufacturers who could benefit from the changes.

The deal includes extending the patents on biologic pharmaceuticals by two years to 10 years from eight, and increases the amount Canadians can spend online at US retailers without paying duty when those goods cross into Canada. "Canadians expected that an agreement on NAFTA would result in the USA lifting the bogus national-security tariffs on Canadian steel and aluminum".

Following years of threats from Trump and the promise of establishing a new deal more favorable to the US, the latest agreement appears to represent a win for the White House. "You go to the cheapest place possible unless you can get it so much cheaper from the foreign place that you can eat up the cost of the tariffs".

"I hope what they did in the renegotiated agreement is to make sure that the labor and wage standards in Mexico are lifted so that the playing field is more even now", Castro said. I'm talking about everybody.

"Once approved by Congress, this new deal will be the most modern, up-to-date and balanced trade agreement in the history of our country, with the most advanced protections for workers ever developed", Trump told reporters.

"The bar for supporting a new NAFTA will be high".


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