Taking an optimistic attitude toward USMCA deal
What a relief.
We finally have an updated NAFTA—a new North American trade agreement, following more than a year of hardball negotiations and sky-high levels of confusion and anxiety.
From the standpoint of this farmer in Saskatchewan, I couldn’t ask for a much better outcome, in part because I was truly nervous about a much worse result.
The initial public conversation around ending NAFTA caught me off guard. I’ve learned my lesson…Take nothing for granted, including the world’s most rocksolid economic partnerships.
The experts are still looking over the fine print of the deal, which has now been titled the “USMCA,” for the United States-Mexico-Canada Agreement.
At this early moment, I won’t pretend to be an expert on the details, though in time I expect to learn many of them. Most of what I know presently comes from press coverage and industry sources.
The big news for wheat farmers in both Canada and the United States is that we’ve secured something called “reciprocal grading,” which is a fancy way of saying that we’ll start to treat registered varieties of wheat the same on both sides of the border. The bottom line is that the agreement will remove an unnecessary trade barrier, something that was keeping me up at night. Grain farmers from both Canada and the USA have wanted this updated for a long time and now we’ve got it.
Speaking of updates, it was not an oversight that biotech crops were not addressed in the original NAFTA. They were in trials but not yet available for any farmers. This new agreement acknowledges that technology has progressed in our sector and addresses the approval of biotechnology, including the new geneediting tools. It’s a modern innovation that needed to be addressed.
Another important change in agriculture trade involves the dairy sector. Under the USMCA, American dairy farmers will enjoy increased access to Canadian markets. Many commentators have interpreted this as a Canadian concession, and in a way this is true. Yet I’m also optimistic for Canadian dairy farmers. I am confident they can compete with anybody in the global market.
The USMCA is of course about much more than agriculture. I won’t even begin to try to describe its complicated rules for automakers. I’m glad to see that we’ll retain NAFTA’s dispute-resolution panels, which the United States had criticized. They’ll remain in place, largely because Canada insisted. As a mom, I smiled about this one. I can’t help but think of this as “playing by the rules” and that’s something I can explain to my kids.
The agreement also has a sunset clause, which means that it could expire in 16 years if the member nations don’t actively reaffirm it. My preference would be for something more permanent, but for now we’ll benefit from a stable set of rules at least until the 2030s. I was a kid when the original NAFTA agreement was put in place and it’ll be interesting to see how the next generation of farmers addresses this, years from now. Who am I kidding, I’ll still be sticking my nose in it too!
For all of the unease these trade talks have generated, the final product looks similar to where we started, with each side giving a little and each side getting a little.
Pundits will debate whether the USMCA is better or worse than the original NAFTA. They’ll discuss who gained the most and who gave the most. They’ll draw up lists of winners and losers.
Allow me to take a different approach: With the USMCA, we’re all winners.
That’s because we weren’t really choosing between NAFTA and the USMCA. NAFTA was dead and gone. It wasn’t coming back from the grave, no matter how hard we wanted to wish for a different reality.
The actual choice was between the USMCA and nothing at all.By making the deal, we’ve decided to forge ahead with a revised agreement that confronts the challenges of the 21st century. The alternative is to prefer a broken-down partnership—a failure that pushes us backward in time, making it harder for North Americans to exchange goods and services across borders.
If I’ve learned anything from this experience, it’s that even our closest alliances require constant attention. Canada and the United States may share the world’s longest undefended border, but we can’t assume that nothing will ever go wrong.
Just as parents and kids (I can’t help the analogies) sometimes have challenging, heart-toheart conversations, sometimes nations have to renegotiate their trade agreements.
Plenty of uncertainty lies ahead. The three USMCA nations still must ratify the deal that their trade diplomats have approved.
But those are problems for another day. Right now, I’m just thankful that our countries have chosen to stick together as neighbors, friends and yes trading partners.
Cherilyn Nagel and her family own a diversified grain farm in Mossbank, Saskatchewan, Canada. In addition to farming, Cherilyn is active in many agricultural policy initiatives to improve the sustainability of agriculture and advocate for modern agricultural practices. Cherilyn volunteers as a board member for the Western Canadian Wheat Growers (www.wheatgrowers.ca) and the Global Farmer Network (www.globalfarmernetwork.org).